annual report

Transcription

annual report

2009
SBS TRANSIT LTD
ANNUAL REPORT
CONTENTS
1
2
6
7
8
13
15
21
24
33
36
37
38
Our Vision
Chairman’s Statement
Financial Highlights
Corporate Information
Board of Directors
Key Management
Operations Review
Sustainability Report
Corporate Governance
Risk Management
Financial Calendar
Financial Statements
Report of the Directors
44
45
46
48
49
50
52
53
90
91
92
Statement of Directors
Independent Auditors’ Report to the
Members of SBS Transit Ltd
Statements of Financial Position
Group Income Statement
Group Comprehensive Income Statement
Statements of Changes in Equity
Group Cash Flow Statement
Notes to the Financial Statements
Share Price Movement Chart
Shareholding Statistics
Notice of Annual General Meeting
Proxy Form
OUR VISION
MOVING PEOPLE
IN A SAFE, RELIABLE AND
AFFORDABLE WAY.
OUR MISSION
TO ACHIEVE EXCELLENCE FOR OUR CUSTOMERS,
EMPLOYEES, SHAREHOLDERS AND COMMUNITY.
TO THIS END, WE ARE COMMITTED TO DELIVERING
SAFE AND RELIABLE SERVICES AT AFFORDABLE PRICES,
BEING AN EMPLOYER OF CHOICE, CREATING SIGNIFICANT
SHAREHOLDER VALUE AND BECOMING A SOCIALLY
RESPONSIBLE CORPORATE ROLE MODEL.
OUR BELIEFS
TO ACHIEVE OUR VISION AND MISSION,
WE ARE GUIDED BY THE FOLLOWING BELIEFS:
We will:
Be driven by our customers’ needs
Strive for excellence in everything
we do
Treat people with fairness and respect
Collaborate with our partners for
a win-win outcome
Maintain safety as a top priority
Give our shareholders a reasonable
return
Act with integrity at all times
01
CHAIRMAN’S STATEMENT
SUN TZU WROTE THAT A GENERAL WHO
KNOWS THE TERRAIN, CALCULATES THE
CHALLENGES AND PUTS THIS KNOWLEDGE
INTO PRACTICE, WILL WIN BATTLES.
CONVERSELY, ONE WHO FAILS TO UNDERSTAND
HIS SURROUNDINGS OR FAILS TO PUT
HIS KNOWLEDGE INTO PRACTICE,
IS BOUND FOR FAILURE.
new buses – 200 single and 150 double-decks during the
year. This brings our total investment in new buses in the
past five years to $586 million. When the latest batch of new
buses hit the road, one in two buses in our fleet will be new.
Such insights resulted in great victories over 2,500 years
ago. Today, they remain hugely relevant.
For sure, 2009 continued to be a challenging year for SBS
Transit. The terrain changed dramatically with Singapore
starting off the year in a technical recession and then
emerging from it around the middle of the year. Amidst
that turbulent ride, there was the threat posed by the
emergence of the Influenza A (H1N1) strain.
As we took delivery of more new buses, we were also able to
roll out more wheelchair-accessible bus (WAB) services to
cater to the transport needs of the physically disabled. A total
of 16 new WAB services were introduced during the year,
further reinforcing our commitment to this special group
of commuters. We first rolled out such services in 2006.
As at the end of 2009, we operated 38 WAB services and
will continue to roll out more as soon as more bus stops
become wheelchair-accessible.
But we did not falter. We remained focussed on our
commitment to be a responsible public transport operator
and continued to add new services whilst enhancing our
service standards to meet the rising expectations of our
commuters. Even as we did these, we never forgot our
commitment to our shareholders in particular, and the
society in general.
At our bus interchanges, we have implemented a new
information service that provides commuters with
information about the departure times of our services.
Currently, this information service is available at seven
interchanges. By the end of this year, it will be extended to
all our 16 interchanges.
SERVING OUR CUSTOMERS
We continued adding new buses in 2009, thereby reducing
the average age of our fleet. In all, we placed orders for 350
02
We are not just focussed on bringing in new services, we
work hard at improving our existing service levels as well.
For the year under review, we made significant improvements
to our performance in the Public Transport Council’s
Quality of Service Standards. For the six-month assessment
period from December 2008 to May 2009, our bus
operations successfully met the Standard of “Adherence to
Scheduled Headways”. One of the key factors contributing
to our improved performance is our success in recruiting
more Bus Captains in 2009 – something we were not able
to do in previous years. As a result of our recruitment drives
in Singapore and China, we were able to add on 973 Bus
Captains during the year, thereby improving on our ability
to meet the Quality of Service Standards.
The Authorities have also tightened the Standards, such
that they now require that 80% of our basic services and
90% of our feeder services arrive with a scheduled frequency
of 10 minutes or less during peak hours. We have since
added 90 more buses to meet this new Standard. We
continue to work on minimising the incidence of overloading
on our buses during peak hours.
In rail operations, we continued to surpass all the operating
performance standards set by the Authorities by a good
margin. We further enhanced frequency and capacity by
adding 60 new trips a week to cater to growing demand.
Given our strong track record in operating the North East
Line, which is the world’s first driverless underground heavy
rail system, we have hosted many international rail authorities
and operators.
Service is, of course, more than just meeting operating
requirements. It is also about upping the service attitudes
of our staff. This is what our CARES programme aims to
do. Anchored in eight service areas, the programme trains
our staff to provide caring, reliable and safe services to our
commuters on both our trains and buses. So far, one-third
of our people have completed this programme. We plan to
put all our 7,500 staff – both frontline and support –
through this programme by the end of 2011. All our 5,500
Bus Captains have also successfully completed the first
phase of the Driving Skills Enhancement Programme
which equips them with skills for safe driving and at the
same time, promotes fuel efficiency.
03
Our Business Continuity Management (BCM) Plans were
also put to the test during the 2009 outbreak of the Influenza
A (H1N1) virus in Singapore. When the threat levels were
raised, we immediately swung into action and put in place
precautionary measures for the well-being of our staff and
commuters. Temperature checks were conducted and
reminders on personal hygiene habits sent out. All our
buses, trains, bus interchanges and rail stations were cleaned
and disinfected throughout the day. We also prepared
alternative housing plans for our Bus Captains and finetuned our BCM Plans. Thankfully, the crisis did not escalate
further and the alert levels eventually went down.
FINANCIAL RESULTS
Revenue decreased by 4.7% from $731.3 million to $697.1
million in 2009.
As we work hard to improve our service levels, I am heartened
that our efforts have not gone unnoticed. The number of
compliments sent in by our commuters has soared while
that of complaints has fallen. On an individual level, our
Senior Bus Captain Wong Seng Chow did us proud by
clinching the highest award in the land transport category
at the national Excellent Service Awards (EXSA) when he
was crowned the EXSA Superstar. At just 25 years old, he
demonstrates how having passion in one’s job makes the
difference between mediocrity and excellence.
The drop in revenue at Group level was, however, offset by
a reduction in operating expenses – due mainly to a drop
in fuel and electricity costs. As a result, operating profit
increased by 32.1% from $47.1 million to $62.2 million.
Revenue from bus services fell by 6% to $546.0 million
due to the temporary fare reduction, the increase in transfer
rebate, and a drop in ridership. This was offset somewhat
by a 2.5% increase in rail revenue to $109.2 million.
Revenue from our advertisement business was 11.6% lower
at $27.3 million as advertisers scaled back on their
expenditure. Revenue from our rental business increased by
14.2% to $14.6 million.
Net profit for the year grew by 34.6% from $40.6 million
to $54.6 million.
Earnings per share was 17.75 cents, up from 13.19 cents
previously, while net asset value per ordinary share increased
by 11.9% to 94 cents. As at 31 December 2009, total equity
for the Group increased by 12% to $288.1 million due
mainly to profits generated from operations, which were
partially offset by the payment of dividends.
OUR BUSINESS PRINCIPLES
As Singapore grappled with recessionary pressures, we
felt it was important to do our part as a corporate citizen.
We therefore did not apply to the Public Transport Council
for a fare revision but in fact, went one step further by
implementing a temporary fare reduction and increasing
the transfer rebate. This resulted in a two cents reduction
for all adult ez-link fares for train and basic bus services,
and a reduction of up to 20 cents for non-basic bus services.
Senior citizen concession ez-link fares for train and basic
bus services were also reduced by two cents. The transfer
rebate for these two groups of adult commuters increased
by 10 cents to 50 cents – on top of the 15 cents increase
that was implemented in October 2008. Child and student
concession ez-link fares dropped by one cent per trip.
The prices of monthly passes for students and National
Servicemen were also reduced by between $1 and $4.
The Directors have proposed a tax-exempt one-tier final
ordinary dividend of 4.3 cents per share for the approval of
Shareholders. Together with the tax-exempt one-tier interim
ordinary dividend of 4.5 cents per share paid earlier, the
total tax-exempt one-tier ordinary dividend to be paid out
for 2009 will be 8.8 cents per share.
ECONOMIC STRATEGIES COMMITTEE
The Singapore Government has accepted the key thrusts of
the Economic Strategies Committee’s Report, which calls
for a two to three percent annual productivity growth over
the next 10 years, translating into a three to five percent
annual increase in Gross Domestic Product over the same
period. All these point to a slower expanding workforce
with a focus on skills, innovation and productivity. While
these are areas that we, as a Group, had already focussed on,
the Board will meet up with Management to discuss how
we can further reinforce our commitment to upgrading the
In all, these temporary relief measures, which will run for
15 months until 30 June 2010, will cost us $42.7 million
– more than the $22.3 million that we received from
Budget 2009.
04
strong track record in the operation of the North East Line
will stand us in good stead.
$697.1m
APPRECIATION
I would also like to take this opportunity to advise that
Mr Gan Juay Kiat, who was first appointed our Chief
Operating Officer in April 2007, and then Executive Director
in March 2009, is now the Chief Executive Officer. He has
been groomed to assume this position under the guidance
and supervision of the Deputy Chairman, Mr Kua Hong
Pak. We look forward to his continued contributions.
REVENUE
$62.2m
OPERATING PROFIT
To our Customers, thank you for your continued support
and kind patronage. We are nothing without you and
we will continue to work hard at doing better in the
years ahead.
8.8 cents
TOTAL DIVIDEND PER
ORDINARY SHARE
To our loyal Shareholders, thank you for your understanding
and trust in our ability to deliver what has been committed.
skills of our workforce, introducing even more innovation
and upping the productivity factor in our workplace.
To our Management and Staff, thank you for your hard
work and commitment. I would also like to express my
deepest appreciation to my fellow Directors for their
continued guidance. To the National Workers’ Transport
Union, Authorities, Advisors and Grassroots Leaders, thank
you for your cooperation and assistance.
THE YEAR AHEAD
Several key initiatives of the Government’s Land Transport
Masterplan are expected to be implemented in the next few
months. The much-talked about distance-based through
fares to facilitate transfers and the move towards central
planning of bus routes are scheduled for implementation
in 2010.
The Authorities will also subsequently parcel out routes
for tender and this will have a major impact on the way
we operate. We are, however, prepared for this upcoming
challenge and have in fact been tapping on the experience
of our sister companies in London and Sydney which operate
in a tender regime.
A tender will also be called for the licence to operate the
Downtown MRT Line during the year. This is a 40-km
long line that will link the north western and eastern areas
of the island to the Central Business District and the Marina
Bay. We are excited by the prospect of increasing our
foothold in the rail business and are confident that our
Lim Jit Poh
Chairman
05
FINANCIAL HIGHLIGHTS
REVENUE ($’mil)
PROFIT AFTER TAX ($’mil)
800
731.3
700
600
590.3
629.0
670.7
60
56.1
697.1
51.5
20
54.6
18
50.0
50
40.6
17.7
16.3
14
13.2
12
400
10
30
8
300
20
6
200
4
10
100
0
18.5
17.1
16
40
500
EARNINGS PER
ORDINARY SHARE (cents)
2
2005
2006
2007
2008
0
2009
2005
2006
2007
2008
NET ASSET VALUE PER
90.6
25
93.6
89.6
83.6
76.7
80
2005
2006
2007
2008
2009
TOTAL DIVIDEND PER
100
90
0
2009
20
23.3
20.0
70
60
14.7
15
50
40
10
8.8
30
6.6
20
5
10
0
2005
2006
2007
2008
0
2009
2005
2006
2007
2008
2009
FINANCIAL SUMMARY
Revenue ($’mil)
Operating Profit ($’mil)
Operating Expenses ($’mil)
Profit after tax ($’mil)
EBITDA ($’mil)
Issued capital ($’mil)
Capital and reserves ($’mil)
Capital disbursement ($’mil)
Internal funds generated ($’mil)
Earnings per ordinary share (cents)
Net asset value per ordinary share (cents)
Return on shareholders’ equity (%)
Total dividend per ordinary share (cents)
Dividend cover (number of times)
2005
2006
2007
2008
2009
590.3
57.0
533.3
51.5
81.7
75.6
274.1
18.4
81.8
17.1
90.6
18.6
20.0
0.9
629.0
57.0
572.0
56.1
81.7
83.4
271.7
84.0
81.6
18.5
89.6
20.6
23.3
0.8
670.7
53.2
617.5
50.0
87.9
91.3
235.5
64.5
87.5
16.3
76.7
19.7
14.7
1.1
731.3
47.1
684.2
40.6
78.6
92.3
257.2
146.7
77.2
13.2
83.6
16.5
6.6
2.0
697.1
62.2
634.9
54.6
102.7
92.3
288.1
164.3
101.2
17.7
93.6
20.0
8.8
2.0
2005
$’000
%
2006
$’000
%
2007
$’000
%
2008
$’000
%
2009
$’000
%
VALUE-ADDED FOR THE GROUP
Suppliers of capital – dividends & term loan interest 61,202
Taxation to the government
22,752
Retained earnings
10,084
Employees - salaries, and other staff costs
261,165
Total value-added
Value-added per employee ($’000)
17.2
6.4
2.9
73.5
355,203 100.0
69,167
22,793
2,778
273,221
18.8
6.2
0.7
74.3
367,959 100.0
51.4
50.2
06
45,229
21,513
37,853
280,819
11.7
5.6
9.8
72.9
385,414 100.0
53.5
20,310
23,960
48,810
287,743
5.3
6.3
12.8
75.6
380,823 100.0
53.9
27,079
22,355
67,528
289,113
6.7
5.5
16.6
71.2
406,075 100.0
54.5
CORPORATE INFORMATION
BOARD OF DIRECTORS
REMUNERATION COMMITTEE
CORPORATE DIRECTORY
Lim Jit Poh
Chairman
Chin Harn Tong
Chairman
Kua Hong Pak
Deputy Chairman
John De Payva
Registered Office
205 Braddell Road
Singapore 579701
Mainline: (65) 6284 8866
Facsimile: (65) 6287 0311
Website: www.sbstransit.com.sg
Company Registration Number:
199206653M
Lim Jit Poh
Gan Juay Kiat
Chief Executive Officer
NOMINATING COMMITTEE
Company Secretaries
Chan Wan Tak, Wendy
Chew Si Lyn, Cecilia
Cheong Yip Seng
Chin Harn Tong
John De Payva
Chairman
John De Payva
Cheong Yip Seng
Tan Kong Eng
Wong Chin Huat , Da vid
Share Registrar
B.A.C.S. Private Limited
63 Cantonment Road
Singapore 089758
Wee Siew Kim
SERVICE QUALITY COMMITTEE
Wong Chin Huat, David
Wong Chin Huat , Da vid
Chairman
AUDIT COMMITTEE
Cheong Yip Seng
Wee Siew Kim
Chairman
John De Payva
Chin Harn Tong
Wee Siew Kim
Auditors
Deloitte & Touche LLP
Public Accountants and
Certified Public Accountants
6 Shenton Way #32-00
DBS Building Tower 2
Singapore 068809
Partner-in-Charge:
Kee Cheng Kong, Michael
Tan Kong Eng
Date of Appointment:
8 November 2006
07
BOARD OF DIRECTORS
Lim Jit Poh
Chairman (Non-Executive & Non-Independent)
Kua Hong Pak
Deputy Chairman (Non-Executive & Non-Independent)
Mr Lim Jit Poh was appointed non-executive Chairman and
Director of SBS Transit Ltd in 2003. He is a member of the
Remuneration Committee. Mr Lim is also the Chairman of
ComfortDelGro Corporation Limited, VICOM Ltd, Ascott
Residence Trust Management Limited, China Printing & Dyeing
Holding Limited and Eng Kong Holdings Limited, as well as the
Lead Independent Director of Kim Eng Holdings Limited. These
are listed companies with business interests in stock broking,
property trust, hospitality and manufacturing. Mr Lim is also a
Director of several non-listed companies under the ownerships
of the Singapore Labour Foundation and Temasek Holdings
(Private) Limited.
Mr Kua Hong Pak was appointed the Executive Director of SBS
Transit Ltd in 2002. In 2003, he was appointed Deputy Chairman
of the Company. Mr Kua is presently the Managing Director/
Group Chief Executive Officer of ComfortDelGro Corporation
Limited. Prior to this, he was the President/Chief Executive Officer
of Times Publishing Limited where he managed its Singapore and
overseas operations in the United States, United Kingdom, China,
Japan, Hong Kong and Australia.
Mr Kua also serves on the boards of Temasek Holdings (Private)
Limited, PSA International Pte Ltd, PSA Corporation Limited,
StarHub Ltd, Ringier Print (HK) Limited and Cabcharge Australia
Limited. He is also an Honorary Citizen of Shenyang City, China.
In recognition of his contributions to community service, he was
awarded the Public Service Medal in 1991 and the Public Service
Star in 1996 by the President of the Republic of Singapore and
re-appointed a Justice of the Peace in 2005. He was awarded a
Medal of Commendation by the National Trades Union Congress
in 2005.
Mr Lim was a former top civil servant and a Fulbright scholar.
He was awarded the Public Administration Medal by the
Government of Singapore in 1972, as well as three awards by the
National Trades Union Congress, namely the Friend of Labour
Award in 1986, the Meritorious Service Award in 1990 and the
Distinguished Service Award in 2000. In 2006, he was also one
of the recipients of the Distinguished Science Alumni Award from
the National University of Singapore. Mr Lim is a trustee of the
Singapore National Employers’ Federation.
Mr Kua holds a Bachelor of Accountancy from the University of
Singapore and is a Fellow of the United Nations Asian Institute.
He also attended the Advanced Management Programme at
Harvard Business School.
In his previous employment as Executive Director of two public
listed companies, Mr Lim had been directly involved in negotiations
with business partners and relevant authorities on various joint
venture projects in the ASEAN region as well as in China, Hong
Kong, United Kingdom, Australia and Mauritius. He was also
involved in the management of these operations. Mr Lim was a
Council Member of the Singapore Chinese Chamber of Commerce
and Industry and the National University of Singapore, and a
member of the Singapore British Business Council. He was also
very active in community work being Chairman of a community
centre management committee. Presently, he serves as President
of Orchid Country Club and a member of the Board of
Management of Pei Chun Public School.
Pursuant to Article 97 of the Company’s Articles of Association,
Mr Kua will be due for re-election at the forthcoming Annual
General Meeting to be held on 28 April 2010. He is a nonindependent Director of the Company.
Mr Lim holds a Bachelor of Science (Hons) in Physics from the
University of Singapore and a Master of Education from the
University of Oregon, USA.
Pursuant to Section 153(6) of the Companies Act, Cap 50,
Mr Lim will be due for re-appointment as a Director at the
forthcoming Annual General Meeting to be held on 28 April
2010. He is a non-independent Director of the Company.
08
BOARD OF DIRECTORS
Gan Juay Kiat
Chief Executive Officer & Director
Cheong Yip Seng
Director (Non-Executive & Independent)
Mr Gan Juay Kiat was appointed Chief Executive Officer
of SBS Transit Ltd on 1 March 2010. Mr Gan first joined
ComfortDelGro Corporation Limited as Group Corporate Planning
Officer of SBS Transit in February 2006. Subsequently, he was
also appointed the Chief Executive Officer and Director of
ComfortDelGro Bus Pte Ltd. In April 2007, he assumed the role
of Chief Operating Officer of SBS Transit Ltd, and was appointed
Executive Director on 1 March 2009.
Mr Cheong Yip Seng has been a non-executive Director of
SBS Transit Ltd since 1997. He is an independent Director of the
Company. Mr Cheong is a member of the Nominating Committee
and Service Quality Committee. Mr Cheong was the Editor-inChief of the English/Malay Newspapers Division of Singapore
Press Holdings Limited from 1987 to 2006. In 2007, he became
an Editorial Advisor to SPH until June 2008.
He was Chairman of the Advisory Committee on the Impact of
New Media on Society from April 2007 to April 2009. He is also
a member of the Board of the Building and Construction Authority.
Prior to joining the ComfortDelGro Group, Mr Gan was the
Chief Corporate Officer at the Ascott Group and Senior Vice
President (Corporate Planning) at CapitaLand Limited.
Mr Cheong was last re-elected a Director of the Company pursuant
to Article 97 of the Company’s Articles of Association at the
Annual General Meeting held on 27 April 2009.
Mr Gan started his career in the Singapore Armed Forces where
he held several senior command and staff appointments. He moved
on to join General Electric Company as a Divisional Director,
and later to Times Publishing Limited as Senior Vice President
(Retail & Distribution).
Mr Gan was a President’s Scholar and SAF (UK) Scholar in 1976.
He holds a Bachelor of Arts (Engineering Tripos) from the
University of Cambridge.
Mr Gan was last re-elected a Director of the Company pursuant
Annual General Meeting held on 27 April 2009. He is a nonindependent Director of the Company.
09
BOARD OF DIRECTORS
Chin Harn Tong
John De Payva
Mr Chin Harn Tong has been a non-executive Director of
SBS Transit Ltd since 1993. He is an independent Director of the
Company. Mr Chin is the Chairman of the Remuneration
Committee and a member of the Audit Committee. He is also a
Director of CityCab Pte Ltd. He had previously been the Secretary,
Executive Director and Advisor of NTUC Comfort (1971–1986).
Mr John De Payva has been a non-executive Director of SBS
Transit Ltd since 1999. He is an independent Director of the
Company. Mr De Payva is the Chairman of the Nominating
Committee and a member of the Remuneration Committee and
Service Quality Committee.
Mr De Payva is the President of the National Trades Union
Congress (NTUC). He is also a Director and Secretary-General
of the Singapore Manual and Mercantile Workers’ Union since
January 1988 and a Director of NTUC Fairprice Co-operative
Ltd, and a member of the Board of Governors of OTC-ILS.
Mr Chin is the Advisor to the North-East Community
Development Council and the Singapore Stevedores’ Union.
He was a Member of Parliament for Aljunied from 1972 to 1996.
He was also the Political Secretary, Parliamentary Secretary and
Senior Parliamentary Secretary between 1976 and 1988.
Mr De Payva holds a Diploma in Industrial Relations from the
Singapore Institute of Labour Studies.
Mr Chin was awarded the Public Administration Medal by the
Government of Singapore in 1971, the Friend of Labour Award
in 1971 and the Meritorious Service Award by the the National
Trades Union Congress (NTUC) in 2000. He was also appointed
a Justice of the Peace in 1998.
Mr De Payva was awarded the Public Star Medal in 1998
and Public Service Star in 2004 by the President of the Republic
of Singapore.
Mr Chin holds a Bachelor of Arts from the Nanyang University
(1963). In 1970, he was awarded the Colombo Plan Fellowship
in Industrial Relations, Australia and was subsequently seconded
to the NTUC and was promoted to the Government’s
Administrative Service.
Mr De Payva was last re-elected a Director of the Company
pursuant to Article 97 of the Company’s Articles of Association
at the Annual General Meeting held on 30 April 2008.
Pursuant to Section 153(6) of the Companies Act, Cap 50, Mr
Chin will be due for re-appointment as a Director at the forthcoming
Annual General Meeting to be held on 28 April 2010.
10
BOARD OF DIRECTORS
Tan Kong Eng
Wee Siew Kim
Mr Tan Kong Eng has been a non-executive Director of SBS
Company. He is a member of the Audit Committee. Mr Tan was
the Managing Director of DelGro Corporation Limited between
1973 and 1994. Mr Tan retired in 1994 and is currently a Director
of Glory & Company Private Limited and Changi Bus Company
(Private) Limited.
Mr Wee Siew Kim has been a non-executive Director of SBS
Company. Mr Wee is the Chairman of the Audit Committee and
a member of the Service Quality Committee.
Mr Wee is also the Member of Parliament for Ang Mo Kio GRC.
He is presently President of the Basketball Association of Singapore,
and a Director of Basketball Enterprises Singapore Pte Ltd (BES).
He is also the Chairman of Singapore Quality Institute, and a
Director in Changi Airport International Pte Ltd.
Pursuant to Section 153(6) of the Companies Act, Cap 50,
Mr Tan will be due for re-appointment as a Director at the
forthcoming Annual General Meeting to be held on 28 April 2010.
Mr Wee is currently Group CEO, NIPSEA Group of Companies.
Mr Wee was previously the Deputy CEO of Singapore Technologies
Engineering Ltd. Prior to this, Mr Wee held several positions
within Singapore Technologies Engineering including being the
President of Singapore Technologies Aerospace Ltd.
Mr Wee holds a Bachelor of Science (Aeronautical Engineering)
(Hons) from the Imperial College of Science and Technology and
a Master in Business Administration from the Graduate School
of Business, Stanford University.
Pursuant to Article 97 of the Company’s Articles of Association,
Mr Wee will be due for re-election at the forthcoming Annual
General Meeting to be held on 28 April 2010.
11
BOARD OF DIRECTORS
Director (Non-Executive & Non-Independent)
Mr Wong Chin Huat, David has been a non-executive Director
of SBS Transit Ltd since 1997. He is the Chairman of the Service
Quality Committee and a member of the Nominating Committee.
Mr Wong is the Senior Partner of Ramdas and Wong, a position
he has held since June 1974.
Mr Wong is also a Director of ComfortDelGro Corporation
Limited and several other listed companies. He also serves as a
member of the Public Service Commission and the Singapore
Labour Foundation.
Mr Wong was awarded the Friend of Labour Award in 1989, the
Meritorious Service Award in 1995 and the Distinguished Service
Award in 2001 by the National Trades Union Congress. Mr Wong
also received a Certificate of Appreciation from the Singapore
Labour Foundation for services rendered as a Director of Pasir Ris
Resort Services Pte Ltd in 1989. In 1991, he was awarded the
Public Service Star and in 2005, the Public Service Star (Bar) by
the President of the Republic of Singapore for community and
social services rendered.
Mr Wong holds a LL.B (Hons) from the University of Singapore
and a LL.M from the University of London.
Mr Wong was last re-elected a Director of the Company pursuant
Annual General Meeting held on 27 April 2009. He is a nonindependent Director of the Company.
12
KEY MANAGEMENT
Wong Wai Keong
Senior Vice President
Rail
Woon Chio Chong
Executive Vice President
Bus Development
Mr Wong Wai Keong joined SBS Transit Ltd as Deputy Director,
Engineering (Rail) on 1 April 2000. He assumed the position of
Director, Engineering (Rail) on 1 October 2001. He was appointed
to his current position as Senior Vice President (Rail) on 10 December
2005. Mr Wong was previously with the Mass Rapid Transit
Corporation and the Land Transport Authority, between November
1984 and March 2000. Mr Wong holds a Bachelor of Engineering
(Hons) in Electrical and Electronic Engineering from the University
of Birmingham, United Kingdom. He is a Professional Engineer of
the Singapore Professional Engineer Board and a Chartered Engineer
of the Institute of Electrical and Electronic Engineers, United Kingdom.
He was awarded the Public Administration Medal in 1996.
Mr Woon Chio Chong joined SBS Transit Ltd as Planning Officer
on 16 August 1976 and rose through the ranks with stints in Planning
and Operations. He was appointed Senior Vice President of Service
Development on 1 July 1995 and subsequently appointed Executive
Vice President (Bus Operations) on 1 July 2000. On 1 November
2008, he was re-designated as Executive Vice President (Bus
Development) where he is responsible for the development of bus
routes, operations support, bus training and service quality for the
bus division. In addition, he also oversees the Security department
in the Company. Mr Woon holds a Bachelor of Science (Hons) in
Information Science from the Victoria University of Wellington,
New Zealand.
Eng Sok Yong
Corporate Development
Ng Yew Lin, Linda
Finance
Ms Ng Yew Lin, Linda was appointed Senior Vice President of Finance
in SBS Transit Ltd on 1 Jan 2008. She joined Waterbank Properties,
a subsidiary of ComfortDelGro Corporation Limited, as a Manager
in Finance and Administration in 1996. On 1 October 2001, she was
appointed to the position of Director, Finance for SBS Transit. Prior
to joining the Company, she had held appointments in Keppel Land
Ltd, Tandem Computers International Inc., Singapore Computer
Systems Ltd and Ernst & Young. She holds a Bachelor of Accountancy
from the National University of Singapore and is a Certified Public
Accountant (Singapore) of the Institute of Certified Public Accountants
of Singapore.
Ms Eng Sok Yong was appointed Senior Vice President of Corporate
Development in SBS Transit Ltd in February 2007. Prior to this, she
was the Group Director of Policy and Planning at the Land Transport
Authority, where she was in charge of its corporate communications,
policy development, infrastructure and strategic planning departments.
She had also previously served as Assistant Director in the Ministry
of Trade and Industry, where she was responsible for Singapore’s
multi-lateral negotiations in the World Trade Organisation. Ms Eng,
who was a Public Service Commission (PSC) Scholar, holds a Master
of Science from the London School of Economics
13
KEY MANAGEMENT
Tan I-Lin, Tammy
Corporate Communications
Poh Ee Huat
Vice President
Engineering and Supplies
Ms Tan I-Lin, Tammy is Senior Vice President of Corporate
Communications of SBS Transit Ltd. She is also the Group Corporate
Communications Officer and Spokesman for ComfortDelGro
Corporation Limited, SBS Transit’s parent company. She is responsible
for all corporate communications functions including liaising with
the media and investment community. Ms Tan is also in charge of
investor relations. She started her career with Singapore Press Holdings
in 1995 and held several positions in The Straits Times including
Deputy Money Editor and Deputy News Editor. She holds a Bachelor
of Social Science (Hons) from the National University of Singapore.
Mr Poh Ee Huat joined SBS Transit Ltd as Senior Maintenance Engineer
on 14 September 1989. He assumed the position of Director, Engineering
(Bus) on 1 September 1998, where he was in charge of engineering and
supplies operations of the Bus Business. He was also a key member of
the North East Line project team in securing the NEL, Punggol and
Sengkang LRT business and initial set up of Rail Business area. He was
appointed General Manager, Fleet Management One on 1 July 2002.
Subsequently, he was appointed General Manager of Engineering and
Supplies on 1 June 2006.
Prior to joining SBS Transit, Mr Poh was a Project Engineer with the
Republic of Singapore Air Force. He holds a Bachelor of Engineering
(Hons) in Mechanical Engineering and a Master of Science (Industrial
Engineering) from the National University of Singapore.
Chan Wan Tak, Wendy
Joint Company Secretary
Chew Si Lyn, Cecilia
Joint Company Secretary
Ms Chan Wan Tak, Wendy is the joint Company Secretary of SBS
Transit Ltd. She also holds a similar appointment in ComfortDelGro
Corporation Limited, which is SBS Transit’s parent company. She
joined the Group in September 2007 as Vice President of Group
Finance. Prior to this, Ms Chan was Vice President of Finance and
Operations at k1 Ventures Limited. She had also been with Deloitte
& Touche LLP as Senior Audit Manager. Ms Chan holds a Bachelor
of Accounting & Finance (Hons) from the University of Glamorgan,
UK. She is a non-practising member of the Institute of Certified Public
Accountants of Singapore and a Fellow of the Chartered Association
of Certified Accountants.
Ms Chew Si Lyn, Cecilia is the joint Company Secretary of both SBS
Transit Ltd and ComfortDelGro Corporation Limited. She joined the
Group in September 2008 as Vice President, Group Legal, taking care
of all legal matters. Ms Chew started her career practising law and was
legal counsel in M+W Zander Facility Management Limited prior to
joining the Group. She holds a Master of Laws from the National
University of Singapore.
14
OPERATIONS REVIEW
BUS
BASIC SERVICES / PREMIUM SERVICES / NITE OWL SERVICES /
FAST FORWARD SERVICES / EXPRESS SERVICES / CHINATOWN DIRECT SERVICES /
STADIUM DIRECT SERVICES / PARKS SERVICES
546.0
60.3
2,268
REVENUE ($’mil)
EBITDA ($’mil)
AVERAGE DAILY RIDERSHIP (’000)
2,970
6,621
FLEET SIZE
NUMBER OF EMPLOYEES
BUS
SBS Transit is Singapore’s largest scheduled bus operator
with a 75% share of the market. By offering a wide range
of bus services – comprising 193 basic bus services and
another 57 premium and niche services – we hope to cater
to as wide a spectrum of commuters as possible.
size to ensure that we keep up with the growing demands of
commuters – and this means greater bus frequencies. As at
31 December 2009, we had a total of 2,970 buses – 2.9%
more than what we had a year ago. In all, we took delivery
of 400 new Euro 5, single-deck buses during the year.
Designed to comply with the Enhanced Environmentally
Friendly Vehicle (EEV) standards, the new buses are Asia’s
first, delivering better emission performance than the standard
In fact, over the years, we have been increasing our fleet
15
OPERATIONS REVIEW
we introduced a new information service that provides
commuters with departure times of bus services at our
interchanges. The service, which has been very well received
by commuters, is currently available at seven interchanges
and will be extended to our nine remaining interchanges
by the end of this year.
Euro 5 models. We also made a purchase of 350 new buses
during the year. The 200 single-decks and 150 doubledecks were bought at a cost of $159 million, bringing our
total investment in new buses over the last five years to
$586 million.
As more new buses were introduced, more wheelchair friendly
services were also rolled out. In all, 16 new wheelchairaccessible bus (WAB) routes were launched during the year,
bringing the total number of such services to 38. This
represented an eight-fold increase in the last four years.
Information, as it appears, is a widely sought after commodity.
Our in-house developed Intelligent Route Information
System (iris) continued to grow in popularity last year with
an average of 580,000 short message service (SMS) requests
received each month – up 38% from the previous year. The
website hits have also jumped from a monthly average of
1.3 million to 1.45 million during the year.
As more and more buses are added, the demands on
interchanges have also increased. In December 2009, we
moved to our new, air-conditioned bus interchange in Boon
Lay. With an average daily passenger boarding of 55,000
on a weekday, Boon Lay Interchange ranks as Singapore’s
busiest and at 20,000 square metres, one of its largest as
well. Given the heavy passenger volume, we opted for a
two-phase transition to minimise disruption to commuters.
As a result, 25 of our bus services now operate from the
new site, while three remaining routes – all of which have
heavy passenger loads – will relocate later this year. The
Boon Lay interchange is the latest in a series of “new-age”
interchanges, which were first introduced in 2002 with the
Toa Payoh Interchange. These interchanges are linked with
shopping centres and MRT stations to provide commuters
with a one-stop shopping and commuting experience.
We also worked hard to improve our headways and our
frequencies. Based on the Public Transport Council’s (PTC’s)
Quality of Service Standards, we registered significant
improvements in all areas including “Adherence to Scheduled
Headways” during the six-month assessment period from
December 2008 to May 2009. One of the key contributing
factors is our success in recruiting Bus Captains. This
has been a daunting challenge for us but our recruitment
efforts in China during the year have eased the situation
considerably. As a result of our recruitment efforts in
Singapore and China, we were able to recruit 973 Bus
Captains during the year. We were thus able to improve
our ability to meet the Quality of Service Standards.
The Authorities have also tightened the Standards, such
that they now require that 80% of our basic services and
90% of our feeder services arrive with a scheduled frequency
of 10 minutes or less during peak hours. To meet this
improved Standard, we added 90 more buses. We will
continue to work on minimising the incidence of overloading
on our buses during peak hours.
During the year, we also reviewed our bus routes to meet
the changing travel needs of our commuters following
the opening of the Pioneer MRT Station in Jurong West.
A new feeder service, Service 241, was introduced while
another, Service 242, was amended for better connectivity
to the new station and a faster link to the Boon Lay Bus
Interchange. As part of our regular review of our routes, we
also withdrew the three remaining CityShopper Services
due to low demand and amended the routes of 26 other
services to cater to changing travel needs.
Indeed, our efforts in introducing new services and enhancing
existing service levels have not gone unappreciated by our
commuters. This was borne out in the 2009 Land Transport
Authority’s commuter satisfaction survey which saw a 5%
increase in the number of respondents who were satisfied
with bus services, up from 82% a year ago. The number of
compliments and commendations sent in by our commuters
also hit a new record, while that of complaints dropped.
Significantly, the number of compliments and commendations
exceeded those of complaints.
In fact, bus ridership during the year fell for the first time
in four years as the Singapore economy contracted. The
drop in ridership, however, reversed towards the end of the
year as the economic outlook improved.
Fewer customers did not, however, mean we invested less
in service upgrades. To make bus travel more convenient,
16
OPERATIONS REVIEW
Security-wise, we continued installations of closed-circuit
television systems on board our buses as a deterrent to crime
and for better incident management. Currently, close to
half of our fleet is equipped with such a system. We also
continued to assist the Police in some of their investigations
by making relevant recorded footages available to them.
Our Business Continuity Management (BCM) Plans were
also put to the test, following the outbreak of the Influenza
A (H1N1) virus in Singapore. When the Health Authorities
raised the threat level, we wasted no time in putting our
precautionary measures into place. Temperature checks
were regularly conducted and reminders on personal hygiene
habits issued. Buses and bus interchanges were cleaned and
disinfected throughout the day for the well-being of
commuters using our services. We also stocked up on
personal protection equipment such as gloves and masks.
We fine-tuned our plans for workforce segregation and
alternative housing for our Bus Captains. Fortunately, the
threat level subsided and we did not have to activate our
BCM Plans for workforce segregation.
The penalty fee introduced by the PTC in 2008 to discourage
fare evasion when using the public transport system saw
some 4,600 cases being detected on our buses for the year.
As a result, the PTC collected $96,000 in fines. The numbers
caught are expected to drop in time as fare evaders are
brought to task.
17
OPERATIONS REVIEW
RAIL
NORTH EAST LINE /
PUNGGOL LRT / SENGKANG LRT
109.2
13.9
325
REVENUE ($’mil)
EBITDA ($’mil)
(NORTH EAST LINE)
46
726
(PUNGGOL/ SENGKANG LRTS)
NUMBER OF EMPLOYEES
RAIL
Demand for rail services remained strong in 2009, with
average daily ridership increasing by 5.8% to a record
371,508. Our flagship rail network, the North East Line
(NEL), saw its average daily ridership grow by 5.9% to
325,433 as more developments came up along the North
East corridor. The average daily ridership of the two Light
Rail Transit (LRT) systems – Punggol and Sengkang –
also increased by 5.5% to 46,075 as more residents moved
into the new towns.
To cater to the increase in ridership, 12 new trips were
added to run on NEL on weekdays, resulting in 60 new
trips per week. This greatly enhanced train frequency services
and reduced crowding.
18
OPERATIONS REVIEW
Increasingly, with more residents moving into the
Sengkang new town, we began preparations to operate the
Sengkang West Loop in two directions to cater to the
projected ridership demand. This was implemented in
January 2010.
of the established timetable – as opposed to five minutes
that most other operators around the world use.
Our excellent track record in operating the world’s first
driverless underground heavy rail system has attracted the
attention of rail authorities, developers and operators from
overseas, who constantly make requests to visit us. We have
played host to visitors from Australia, Denmark, China,
Korea, Bangladesh, Taiwan and the United Kingdom. For
the year, key visitors included the Lord Mayor of Sydney
and the Chief Executive Officer of the City of Sydney, as
well as officials from Melbourne’s Ministry of Transport.
To ensure peak performance of our trains, we maintained
a strict schedule of regular and preventive maintenance
works. In 2009, we undertook and completed the overhaul
of 150 cars on the NEL system when they clocked 480,000
km. This involved major servicing of the brakes system. We
have also started another servicing cycle for the airconditioning system as the cars hit the 600,000 km-mark.
With the outbreak of the Influenza A (H1N1) virus in
Singapore, we immediately launched into action which included
temperature checks and stockpiling of personal protection
equipment such as thermometers and gloves. Reminders on
personal hygiene habits were also issued. On the customerfacing end, we cleaned and disinfected our trains and stations
regularly for the well-being of our commuters.
As a result, we continued to surpass the service standards
set by the Land Transport Authority. For instance, we
achieved 99% schedule adherence for train arrivals at terminal
stations – far exceeding the minimum of the 94% that is
required by the Authority. In fact, the tolerance we use for
schedule adherence is much more stringent at two minutes
19
OPERATIONS REVIEW
OUTDOOR ADVERTISING/
RENTAL
BUS ADVERTISING / IN-TRAIN ADVERTISING /
INTERCHANGE ADVERTISING / TRAIN STATION ADVERTISING /
SHOP SPACE / ROAD SHOW SPACE
41.9
28.5
REVENUE ($’mil)
EBITDA ($’mil)
60
NUMBER OF EMPLOYEES
the take-up rate for the advertising spaces in our buses and
trains as well as in our bus interchanges and train stations.
OUTDOOR ADVERTISING & RENTAL
The economic crisis did not dampen the innovative
spirit of Moove Media, which is the advertising arm of
our parent company, ComfortDelGro Corporation Limited.
We continued to maintain an average occupancy rate of
99% for our retail spaces despite the tough times. The retail
spaces at selected NEL stations like Dhoby Ghaut and
HarbourFront were especially popular with prospective
tenants. In all, we increased our total commmercial space
by 5% to 4,523 square metres.
During the economic recession, when advertisers were
looking to stretch their marketing dollars, Moove Media
came up with creative options to offer advertisers an
integrated platform for their campaigns. This increased
20
SUSTAINABILITY REPORT
THERE CAN BE NO HALF MEASURES WHEN
IT COMES TO SUSTAINABILITY.
In line with this, we put our Bus Captains through a refresher
programme once in every two years. Known as the “Driving
Skills Enhancement Programme”, it equips and refreshes
Bus Captains with skills for safe driving and at the same
time, promotes fuel efficiency. Using the VigilVanguard
system, it makes use of video cameras and sensors to
provide an objective assessment of a Bus Captain’s driving
performance. All our 5,500 Bus Captains have successfully
completed the first phase of this programme.
At SBS Transit, we embrace our social responsibilities
wholeheartedly – whether it is to the environment, the
communities we operate in or the staff who make us who
we are.
We know that sustainability is not just about tomorrow.
It is about the decisions we make today. This is why we
continue to invest in the future regardless of economic
circumstances. Indeed, we do so in many ways, from
supporting the educational needs of our youths, to developing
our staff so that they can achieve more.
It is also important that our staff work in a safe environment.
Our NEL and LRT engineering and operations have
been officially recognised as a bizSAFE Partner by the
Workplace Safety and Health Council. We have also reviewed
and enhanced our Competency Management Programme
to ensure that our rail operations staff are equipped and
competent in handling major incidents and dealing with
equipment and system failures.
HUMAN SUSTAINABILITY
Helping the Community
In 2009, we contributed more than $110,000 in cash
towards several charitable and community causes. This is
over and above the $42.7 million that we are giving through
a temporary fare reduction and an increase in transfer
rebate over a 15-month period until 30 June 2010 to help
ameliorate the cost of travel for commuters during the
economic recession.
For the year, we conducted 62 talks and visits, sharing safety
tips when travelling on buses and trains with some 39,000
students. These were in addition to the exhibitions that
were organised at five NEL stations to promote escalator
safety. To reinforce the message, we installed speakers at
selected escalator landings to remind commuters, especially
the elderly, to hold onto the handrails when on the escalators.
We also provided free use of space at our bus interchanges
and North East Line (NEL) stations for meaningful
programmes that serve our community. In particular, we
accorded the Singapore Red Cross Society use of space at
our NEL stations for five blood donation exercises where
close to 2,000 units of blood was collected.
We also conducted four community exercises to brief
residents on security measures and practices that are in place
at the stations and on board trains. They also participated
in an evacuation drill. To date, some 1,600 residents have
participated in the programme.
We continued to partner the Police in putting up posters
of missing persons on dedicated notice boards at our NEL
stations and selected bus interchanges in a bid to help
families locate their loved ones.
Promoting Graciousness and Good Customer Service
We partnered the Singapore Kindness Movement (SKM)
and the Land Transport Authority (LTA) in their campaigns
to spread and encourage the positive display of gracious acts
such as giving up one’s seat to those in need. We sponsored
some $4 million worth of advertising spaces and $135,000
Promoting Safety
Safety is not something that we compromise with. The safety
of our passengers, our staff and other road users is paramount
to us and the importance we accord to it is reflected in our
policies, procedures and community outreach programmes.
21
He also holds the distinction of being appointed the
youngest Service Mentor.
in cash to fund the six-month long campaign which was
initiated by the LTA and featured Singapore’s two best loved
comedians, Phua Chu Kang and his wife, Rosie. Catchy
phrases popularly used by Phua Chu Kang such as “Don’t
play play. Let me come out first.” and “Sleeping? Don’t
pretend. Give up this seat to those who need it more.” were
featured on all the publicity materials at selected train
stations, interchanges, on board trains and buses.
In support of the Government’s push to promote public
transport, we will continue to do more to serve our
commuters. In line with this, we will be further boosting
our productivity for operational flexibility. More Bus Captains
will be trained to be efficient in driving both single and
double-deck buses, as well as taught to drive at least three
bus routes. For commuters, this will mean
that we are able to deliver on our services,
even when there is a shortfall of
Bus Captains on a particular bus
route. At the same time, we will
continue our efforts to attract and
retain Singaporean Bus Captains.
We also participated in an exhibition organised by
the SKM to launch their annual Kindness
Month. Visitors to the exhibition who
pledged to give up their seats to others
in need were encouraged to ring a bell.
Student volunteers also went on board
NEL trains to show commuters just how
the act of seat giving is done. Later in
the year, we also partnered the SKM to
give out 1,000 blooms of daisies to
commuters alighting at the NEL Dhoby
Ghuat Station. This was to mark World
Kindness Day where commuters were
encouraged to present flowers to those
who had been kind to them.
Talent Sustainability
Our employees are key to our
continued success. We rely on our
people to sustain growth and deliver
excellent service to our customers.
A holistic and robust human
capital management programme is
therefore crucial to attract, develop,
train and retain a diverse and highly
motivated workforce.
While we work at encouraging
commuters to be gracious, we continued
to strive to improve the service attitudes
of our staff, and this is what our CARES
programme aims to do. Anchored in eight
service areas, our staff are trained to provide
caring, reliable and safe services to our
commuters on both our trains and buses. To date, about
one-third of our staff have completed this training.
As a member of ComfortDelGro
Corporation Limited, we are able to participate in the
Group’s talent development initiatives to ensure that we are
well positioned to generate future growth. A comprehensive
ComfortDelGro Succession Management Plan & Process
(SMPP) was institutionalised during the year. The SMPP
provides guidelines to identify and groom our talent pool.
Those selected under this programme are put through a
series of diagnostic tools, including a personality profile test
and a 360-Degree Leadership Development Feedback
Instrument, to identify their strengths and weaknesses.
With the information derived from the various diagnostic
tools, each individual will be committed to a Leadership
Development Plan detailing the developmental activities to
be undertaken.
In fact, a total of 27,436 training places were provided for
our staff, which is an increase of 58% compared to 2008.
The average training hours per staff also went up by 5.6
hours to 71.9 hours for the year.
Our efforts have not gone unnoticed. A total of 1,168 staff
were awarded the 2009 Excellent Service Awards (EXSA)
last year – 13% more than the previous year. Our Senior
Bus Captain Wong Seng Chow also did us proud by winning
top honours in the land transport category, where he was
crowned the EXSA Superstar. At just 25 years old, he is the
youngest Bus Captain to have won this prestigious award.
Several programmes and initiatives dovetailing with the
individual’s development goals were rolled out last year,
and these included a Core Leadership Programme which
22
Likewise, just as we have tried to reduce harmful emissions
through the purchase of environmentally friendly vehicles,
we have also lent our support to the research of alternative
fuels. We are currently in partnership with the Nanyang
Technological University to explore the possibility of using
fuel cell for buses.
reinforces and brings alive learning through group work.
Engagement and enrichment sessions have also been
organised for senior management to share their leadership
experiences with the next generation.
Senior Management have also been assigned to act as mentors
to selected individuals to impart leadership skills, expose
them to higher management activities and assign challenging
tasks to accelerate their mentees’ learning and growth.
At 10 of our NEL stations, we have installed motion sensors
for light fittings along staff corridors to reduce unnecessary
energy consumption. These lights are automatically switched
off when no one is around and the sensors activate the
lights back on when movement is detected. As a result, we
reduced energy consumption by 314,000 kWH last year.
When this initiative is implemented across all 16 stations
this year, we can expect to reduce energy consumption by
some 650,000 kWH annually.
Environmental Sustainability
As a public transport operator, we are keenly aware of the
important role we play in the preservation of the environment.
In our fleet renewal programme which began in 2006, we
continued purchasing more environmentally friendly bus
models. In 2009, we took delivery of 400 Euro 5 buses that
are designed to comply with the Enhanced Environmentally
Friendly Vehicle Standards. These new buses, which are the
first of their kind in Asia, deliver better emission performance
as compared to the standard Euro 5 models. For instance,
the emission of unburnt hydrocarbons, which produce
ozone that irritates the eyes and lungs and cause breathing
difficulties, is effectively reduced by some 46% or from
0.46g/kWh to 0.25g/kWh, as compared to traditional
Euro 4 and 5 engines.
We also try to spread the message of environmentalism to
the public. During the Green Transport Week in August,
we gave away 6,000 eco-friendly bags bearing Green tips.
A month later, to mark International Car Free Day, we gave
away some 5,000 complimentary travel vouchers to drivers
to encourage them to switch to public transport. Both
initiatives received overwhelming response from the public.
23
CORPORATE GOVERNANCE
AS A LAND TRANSPORT PROVIDER WITH
A VISION OF MOVING PEOPLE IN A SAFE,
RELIABLE AND AFFORDABLE WAY,
WE, AT SBS TRANSIT, REALISE THAT A
FUNDAMENTAL MEASURE OF OUR SUCCESS
IS THE SHAREHOLDER VALUE
WE CREATE OVER THE LONG-TERM.
From the very beginning, our emphasis has been on the
long-term and as a result, we may make decisions and
weigh trade-offs differently from some other companies.
Accordingly, it is important for you, our Shareholder, to
understand our fundamental management and decision
making approach, so that you may ensure that it is
consistent with your own investment philosophy. We will
continue to:
steps to maintain the highest standards of corporate
governance, professionalism and integrity, as we build an
organisation that our Shareholders, Employees, Business
Partners, the Authorities and other Stakeholders can trust
and be proud of. Our adherence to the principles and
guidelines of the Code of Corporate Governance 2005
(the Code) is absolute, and we spare no effort in ensuring
that they are upheld by each and every one in the Company.
We have also adopted a Code of Business Conduct which
sets out the principles and policies upon which our
businesses are to be conducted, as well as implemented a
Whistle Blowing Policy which serves to prevent the
occurrence of unethical or illegal conduct or behaviour,
whilst protecting the whistleblowers from reprisal within
the limits of the law.
• Focus relentlessly on our customers;
• Make sound investment decisions based on long-term
value creation, rather than short-term profitability
considerations;
• Work hard to spend wisely and maintain our lean culture
as we understand the importance of continually reinforcing
cost-consciousness;
This report sets out the corporate governance practices
that were in place during the year with specific reference to
the Code.
• Focus on hiring and retaining versatile and talented
employees.
1. BOARD MATTERS
CORPORATE GOVERNANCE STATEMENT
SBS Transit strongly believes that good corporate governance
makes good business. To this end, the Company has taken
In choosing directors, the Company seeks individuals
who have very high integrity, business savvy, shareholder
orientation and a genuine interest in the Company.
24
The Board’s Conduct of Its Affairs
At the helm of the decision making process of the
Company is the Board of Directors. The Board is headed
by the non-executive Chairman, Mr Lim Jit Poh, and is
responsible for:
four committees have been formed namely, the Audit
Committee (AC), the Nominating Committee (NC), the
Remuneration Committee (RC) and the Service Quality
Committee. Each committee is governed and regulated by
its own terms of reference, which set out the scope of its
duties and responsibilities, regulations and procedures
governing the manner in which the committee is to operate
and how decisions are to be taken. Ad hoc committees are
also formed to look at specific issues from time to time.
(i) Guiding the strategic directions and goals of the
Company;
(ii) Ensuring that appropriate and adequate systems of
internal control, risk management processes and financial
authority limits are in place;
A total of four scheduled Board Meetings are held every
year for the purpose of approving the release of the
Company’s financial results every quarter and the approval
of the Company’s Annual Budget. The quarterly and fullyear Board Meetings are held within 45 days after the end
of each quarter and the financial year respectively. The
Company’s Annual Budget is approved at the Board Meeting
convened for the third quarter’s results. Ad hoc Board and
Committee Meetings are also held from time to time as and
when the need arises. Directors, who are unable to attend
the Meetings in person, can still participate in the discussions
through teleconferencing. Decisions of the Board and Board
Committees may also be obtained via circular resolutions.
Directors are free to seek clarifications and explanations
from Management on the Board papers.
(iii) Assessing and approving key business strategies,
funding and investment initiatives and other corporate
actions, including approval of the Company’s Annual
Budget and Capital Expenditure, and the release
of the Company’s quarterly and full year financial
results; and
(iv) Monitoring managerial performance.
The Board has delegated the day-to-day management of
the Company to the Management headed by the Chief
Executive Officer, Mr Gan Juay Kiat, while reserving certain
key issues and policies for its approval.
The attendance of the Directors at the Board and Committee
Meetings for Financial Year 2009 and the frequency of such
Meetings are set out below.
To assist the Board in the detailed consideration of the
various issues at hand and to facilitate decision making,
ATTENDANCE OF DIRECTORS AT BOARD AND COMMITTEE MEETINGS
Audit
Committee
Board
Name
No. of
No. of
Meetings Meetings
held attended
Nominating
Committee
No. of
No. of
Meetings Meetings
held attended
Remuneration
Committee
No. of
No. of
Meetings Meetings
held attended
No. of
No. of
Meetings Meetings
held attended
Service Quality
Committee
No. of
No. of
Meetings Meetings
held attended
Lim Jit Poh
4
4
–
–
1
1*
3
3
–
–
Kua Hong Pak
4
4
–
–
1
1*
3
3*
–
–
Cheong Yip Seng
4
3
–
–
1
1
–
–
3
1
Chin Harn Tong
4
4
4
4
–
–
3
3
–
–
Gan Juay Kiat
4
4
4
4*
–
–
3
2*
3
3*
John De Payva
4
3
–
–
1
1
3
1
3
3
Tan Kong Eng
4
4
4
4
–
–
–
–
–
–
Wee Siew Kim
4
2
4
4
–
–
–
–
3
2
4
4
–
–
1
1
–
–
3
3
* Attended Meetings by invitation of the Committee.
25
also Directors of ComfortDelGro Corporation, a substantial
Shareholder.
Regular presentations are made by Management to the Board
to enable Directors to better familiarise themselves with the
Company’s businesses. Directors are also furnished regularly
with analyst reports, updates on corporate governance
practices, and articles relating to changes in laws relevant
to the Company’s businesses and operating environments.
Chairman and Chief Executive Officer
The roles of the Chairman and the Chief Executive Officer
have been kept separate and distinct. This is a deliberate
policy and one that is strictly adhered to. This ensures
Management accountability and Board independence. The
Chairman is responsible for the effective functioning of the
Board while the Chief Executive Officer is responsible for
the operations and management of the Company. The Chief
Executive Officer reports to the Deputy Chairman. The
Chairman, Deputy Chairman and the Chief Executive
Officer are not related.
Directors are free to request for sponsorship from the
Company to attend courses to update their knowledge and
better equip themselves to discharge their duties as Directors.
The Board periodically reviews the adequacy of the internal
controls and financial authority limits to ensure that while
there is delegation of authority, there are sufficient checks
and balances in place to monitor such delegation.
The Chairman leads the Board and facilitates effective
and comprehensive Board discussions and decision making
on strategic issues. The Chairman also oversees the translation
of the Board’s decision into executive action. With the
assistance of the Company Secretary, the Chairman
ensures the accuracy and timeliness of information flow
between the Board and Management, effective shareholder
communication and high standards of corporate transparency.
Board Composition and Balance
There is a strong element of independence in the Board.
The Board presently comprises one Chief Executive Officer
and eight non-executive Directors. Of the eight non-executive
Directors, five of them are considered by the NC to be
independent. This composition exceeds the Code’s
requirement of at least one-third of the Board of Directors
to comprise independent Directors. Mr Gan Juay Kiat was
appointed Chief Executive Officer on 1 March 2010.
The Chief Executive Officer is given full executive
responsibility to ensure the day-to-day running of the
Group’s businesses and the implementation of the Group’s
strategies and policies.
The Directors are individuals with a broad diversity
of expertise and experience, both domestically and
internationally. For details on the Board, please refer to the
profiles of the Directors at the start of this Annual Report.
Board Membership and Board Performance
Board renewal is an ongoing process to ensure good
governance and to maintain relevance in the changing
business environment. The NC is responsible for regularly
reviewing the composition of the Board, identifying and
proposing suitable candidates for appointment to the Board.
The NC is responsible for assessing the independence of
the Directors on an annual basis. Each Director is required
to complete a Confirmation of Independence checklist,
which is drawn up in accordance with the guidelines
provided by the Code, and requires each Director to assess
his own independence. The Director is required to declare
any circumstances in which he may be considered nonindependent. The NC will then review the Confirmation
of Independence to determine whether a Director is
independent. The NC deems a Director who is directly
associated with a substantial Shareholder as non-independent.
Mr Lim Jit Poh, Mr Kua Hong Pak and Mr Wong Chin
Huat David are deemed as non-independent as they are
The NC comprises three non-executive Directors, of
whom two, including the Chairman are independent. The
Chairman of the NC is not associated with any substantial
Shareholder. The Company Secretary is the Secretary to
the NC. Appointments and re-appointments of Directors
to the Board of the Company are subject to the approvals
of the Land Transport Authority and the Public Transport
Council.
26
in, the NC will continue to monitor the contributions and
the performance of each Director and to assess whether
each Director has devoted sufficient time and attention to
the affairs of the Company.
The Articles of Association of the Company provide that
one-third of the Board of Directors, including the Chief
Executive Officer, are subject to retirement and re-election
by rotation at every Annual General Meeting (AGM). All
Directors are required to retire from office once at least every
three years. Re-election is, however, not automatic and all
Directors will be assessed by the NC on their past performance
and contributions before being recommended for re-election.
Newly appointed Directors are also subject to retirement
and re-election at the AGM immediately following their
appointments. For the forthcoming AGM, Mr Kua Hong
Pak and Mr Wee Siew Kim are due for re-election pursuant
to Article 97, and Mr Lim Jit Poh, Mr Chin Harn Tong
and Mr Tan Kong Eng are due for re-appointment pursuant
to Section 153(6) of the Companies Act, Cap. 50.
As a policy, the Chief Executive Officer, being an executive
of the Company, will have to seek the approval of the
Chairman before accepting any directorships of companies
not within the ComfortDelGro Group. In considering
whether or not to grant the approval, the Chairman will
consider the time commitment of the Chief Executive
Officer, and whether the new external directorships will
provide strategic fit and networking to the businesses of the
Company. The Chairman will also ensure that the Chief
Executive Officer will not accept appointments to the boards
of competitors.
From time to time, new Directors may be identified for
appointment to the Board after the NC evaluates and assesses
their suitability based on their qualifications, working
experiences and expertise. Upon appointment as a Director,
the Board Chairman will send an official letter of
appointment to the Director which clearly explains his role,
duties and responsibilities. Management will then conduct
a comprehensive orientation programme for the Director,
where key aspects of the business, including financial and
corporate governance policies are discussed. Site visits will
also be arranged for new Directors so that they can better
familiarise themselves with the Company’s operations. When
a Director is appointed to a Board Committee, he will be
provided with its charter.
The effectiveness of the Board is monitored by the NC
annually in terms of overall performance and growth of the
Company, achieving an adequate return for Shareholders,
preventing conflicts of interest and balancing the competing
demands of the Company. In evaluating the contributions
and performance of each individual Director, factors taken
into consideration include attendance at Board Meetings
and activities, contributions in specialist areas and
maintenance of independence.
In the last quarter of the year, each Director will fill in a
Board Performance Evaluation Form, which includes
questions on the Board’s composition, the Board’s contributions,
contributions from Committees and conduct of proceedings
and whether these enable Directors to discharge their duties
effectively. The answers are collated and the findings then
presented by the Chairman to the Board during its Meeting.
The NC subscribes to the view that while it is important
for Directors to devote sufficient time and attention to the
affairs of the Company, the issue of multiple board
representations should be left to the judgement and discretion
of each Director. To focus on Directors’ attendance at Board
Meetings per se may not be an adequate evaluation of the
contribution of Directors. Instead, their abilities to provide
strategic networking to enhance the business of the Company,
availability for guidance and advice outside the scope of
formal Board Meetings and contributions in specialised
areas are also factors relevant in assessing the contributions
of the Directors. While the NC will not stipulate the
maximum number of boards each Director may be involved
Access to Information
Prior to each Board Meeting and where needed,
Management provides Directors with timely, pertinent
and complete information. The Board also receives regular
analyst reports.
The Board has full access to the Senior Management
team. The Company Secretary has defined roles and
responsibilities. She assists in scheduling Board and
27
Committee Meetings and prepares the agenda in
consultation with the Chairman and Chief Executive
Officer. The Company Secretary will attend the Board
and Committee Meetings of the Company and prepare
Minutes of Board and Committee proceedings. The
Company Secretary will keep the Directors informed of
any significant developments, or events relating to the
Company and ensures compliance with all relevant rules
and regulations.
The terms of reference of the RC are to:
(i) Review and recommend to the Board the remuneration
framework for compensation to each Director, and
ensure that the level of remuneration offered is
appropriate to the level of contribution; and
Should there be a need to obtain independent professional
advice on matters relating to the businesses of the Company
or issues affecting the duties of the Directors, the Company
will arrange for the appointment of the relevant professional
advisers at its own cost.
In the discharge of its responsibilities, the RC has sought
expert advice from an external international human resource
consultancy firm.
(ii) Review the remuneration of Senior Management to
ensure that the overall remuneration package is attractive
to retain and motivate key executives.
The remuneration packages of the Chief Executive Officer
and executives of the Company comprise fixed and variable
components. The variable component, in the form of yearend performance bonuses and stock options, form a
significant proportion of the remuneration packages and is
dependent on the profitability of the Company and individual
performance. Subject to market conditions and the operating
environment, the Company targets a total compensation
package with fixed to variable component ratios of 70:30
for rank and file employees, 60:40 for middle management
staff and 50:50 for top management staff. The Company
believes that a higher proportion of performance related
component will ensure greater alignment of interests of the
executives with those of Shareholders. This remuneration
framework is based on the findings and recommendations
of an international human resource consultancy firm
appointed by the Group.
2. REMUNERATION MATTERS
Procedures for Developing Remuneration Policies,
Level and Mix of Remuneration and Disclosure of
Remuneration
The Company recognises the importance of having a
committed and talented workforce to manage and grow the
businesses in an increasingly competitive environment. The
Company therefore places great emphasis on motivating
staff through engagement, recognition and a proper
alignment of reward to performance.
The RC plays a key role in the Company’s remuneration
policies. Besides providing the Board with an independent
assessment and review of Directors’ remuneration, it also
reviews from time to time the remuneration framework and
strategy for executive compensation with the purpose of
developing talent and building leadership to ensure the
Company’s success.
The structure for the payment of Directors’ fees for nonexecutive Directors is based on a framework comprising
basic fees and additional fees for serving on Board
Committees, and also for undertaking additional services
for the Company. The fees are subject to the approval of
Shareholders at the AGM.
In accordance with the Code, the RC comprises three nonexecutive Directors, of whom two including the Chairman,
are independent. Members of the RC are also independent
of Management and free from any business or other
relationships, which may materially interfere with the exercise
of independent judgment. The Company Secretary is the
Secretary to the RC.
The non-executive Directors of the Company are appointed
pursuant to, and hold office in accordance with, the Articles
of Association. They have been granted options under the
SBS Transit Share Option Scheme.
28
The remuneration of the Directors and the key executives
of the Company (who are not Directors) for the Financial
Year 2009 can be found on pages 76 to 77 of this Annual
Report. Information on the SBS Transit Share Option Scheme
can be found on pages 40 to 42 of this Annual Report.
Audit Committee
The Company’s AC comprises three non-executive and
independent Directors. The Board has reviewed and is
satisfied that the members of the AC are appropriately
qualified to discharge their responsibilities.
During the Financial Year 2009, no key executive was an
immediate family member of any Director of the Company
The roles of the AC include the following:
(i) Review the effectiveness of the Company’s internal
audit function, internal controls, including financial,
operational, compliance and risk management;
3. ACCOUNTABILITY AND AUDIT
Accountability
The Board has overall accountability to the Shareholders
of the Company and ensures that the Company is well
managed and guided by strategic objectives. The Company’s
operating performance and financial results are reported
each quarter via SGXNET with an accompanying negative
assurance by the Board to confirm that nothing has
come to its attention that may render the results false or
misleading.
(ii) Review the quarterly and annual financial statements,
and also significant accounting and reporting issues
and their impact on financial statements so as to ensure
the integrity of the financial statements and any formal
announcements relating to the Company’s financial
performance and recommend to the Board the
acceptance of such financial statements;
(iii) Review the scope and results of the audits undertaken
by the Internal and External Auditors, including
non-audit services performed by External Auditors to
ensure that there is a balance between maintenance of
objectivity and cost effectiveness;
The Company has adopted an internal code based on the
Singapore Exchange Limited (SGX’s) guideline to provide
guidance to the Directors and executives of the Company
in relation to dealings in the securities of the Company,
ComfortDelGro and VICOM Ltd. Directors and executives
of the Company are prohibited from dealing in the securities
of the Company, ComfortDelGro and VICOM during the
period commencing two weeks before the announcement
of the Company’s, ComfortDelGro’s and/or VICOM’s
first, second and third quarter results, and one month before
the announcement of the full-year results, and ending on
the date of the announcement of the relevant results.
(iv) Review interested person transactions;
(v) Recommend the appointment, re-appointment or
removal of the External Auditors at the AGM and
review the fees due to them;
(vi) Review the audit plans of the Internal and External
Auditors; and
(vii) Review the effectiveness of the Company’s Whistle
Blowing Policy which has been put in place for
staff to raise concerns in confidence, about possible
improprieties in matters of financial reporting or other
matters and thereupon ensure that an independent
investigation of such matters and appropriate followup actions are taken. The Whistle Blowing Policy
is described in more detail on page 31 of this
Annual Report.
All Directors and executives of the Company are also told
that they must not deal in (i) the securities of the Company,
ComfortDelGro and/ or VICOM on short-term
considerations and /or while in possession of unpublished
material price-sensitive information relating to the relevant
securities; and (ii) in the securities of other listed companies
while in possession of unpublished material price-sensitive
information relating to those securities.
29
ii) Budgetary Control
A robust and challenging Annual Budget is prepared and
approved by the Board prior to the commencement of each
new financial year. Variations between actual and budgeted
performance are reviewed and justifications provided, if
material. This is done on a monthly basis. Specific approvals
are also required for unbudgeted expenditures exceeding a
relevant threshold. In addition, the capital expenditure
budget is approved in principle by the Board when the
Annual Budget is approved. Each capital expenditure is still
subject to rigorous justification and review in accordance
with the Company’s financial authority limits. Tight control
on hiring is also exercised through headcount budgets.
In the performance of its duties, the AC has explicit authority
to investigate the affairs falling within its terms of reference,
full access to and cooperation from Management, discretion
to invite any Director to attend its Meetings, and reasonable
resources to enable it to discharge its duties properly.
During the financial year, the AC also meets with the
External and Internal Auditors in the absence of
Management. During these Meetings, the Auditors may
raise issues encountered in the course of their work directly
to the AC. Prior to the re-appointment of the External
Auditors, the AC assesses their independence based on the
guidelines set by the Accounting and Corporate Regulatory
Authority. The AC has reviewed the independence of the
External Auditors, Deloitte & Touche LLP, including the
scope of non-audit services performed, and has confirmed
that the External Auditors are independent.
iii) Investment Proposals and Business Opportunities
To ensure that the rate of return on any new investment or
business opportunity is commensurate with the risk exposure
taken, apart from undertaking a detailed feasibility study,
the new investment opportunity is evaluated by Management
in terms of (a) return on investment; (b) pay back period;
(c) cash flow generation; (d) potential for internal and external
growth; (e) investment climate; and (f) political stability.
Internal Controls
The Company has well-established internal controls and
compliance functions that have been put in place to manage
risks while achieving business objectives. These include:
iv) Financial Risk
The main areas of financial risk faced by the Company
are foreign currency exchange rate risk, interest rate risk,
credit risk, liquidity risk and fuel price risk. The Company
recognises that management of financial risk is an important
aspect in its drive towards creating shareholder value. It is
the Company’s policy not to participate in speculative
financial instruments. Management oversees financial risk
control and regularly reviews its policy governing risk
management practices.
i) Financial Authority Limits
Comprehensive and specific financial authority limits are
put in place for capital expenditure, operating expenses,
treasury matters, direct investments, revenue tender
participation as well as asset disposal and write-off. These
authority limits are delegated based on the organisational
hierarchy from the Board down to the Chief Executive
Officer and the Heads of Departments, with the Board
retaining the ultimate authority. Any expenditure exceeding
the highest authority limit is referred to the Board for
approval.
Further details of the financial risks and how the Company
manages them are set out on pages 34 to 35 of this
Annual Report.
Financial matters that require the Board’s approval are set
out in the Group’s Financial Procedures Manual (FPM).
All policies and procedures on financial matters, including
approval limits and authorities are clearly defined in the
FPM. To enhance risk management and to ensure that the
Group’s funds continue to be managed prudently, the Board
regularly reviews and updates the mandate that it delegates
to Management.
v) Operational Risk and Business Continuity Planning
The Company has put in place Business Continuity
Management (BCM) Plans to ensure that major disasters
or unforeseen outages do not affect its operations. The BCM
Plans were developed by the various Business Units under
the guidance of the BCM Committee.
30
In the course of their audit, the Internal and External
Auditors also highlight to the AC material deficiencies and
weaknesses together with a response from Management as
to how these could be overcome.
The BCM Plans form part of the holistic management
process to manage risks. Apart from operational risks,
the Company is also faced with financial risks, regulatory
compliance risks and strategic risks. These four risk
categories are used by the Company, and to aid recall, the
Company uses the acronym FOCuS – Financial, Operational,
Compliance and Strategic.
During this financial year, the AC reviewed the Company’s
internal control and risk management processes and was
satisfied that they were adequate to meet the requirements
of the Company.
In addition, the Company’s exposure to property and liability
risks is constantly being monitored and reviewed by
ComfortDelGro’s in-house insurance broking arm. Together
with external risk management consultants, they ensure
sufficiency of coverage, and seek to maintain an optimal
balance between risks that are being retained internally, and
risks that are being placed out with underwriters.
vii) New Accounting Standards
The Group’s Financial Statements are prepared in accordance
with the provisions of the Singapore Companies Act and
the Singapore Financial Reporting Standards (SFRS).
During Financial Year 2009, all the new and revised SFRS
that were relevant to its operations were adopted. The
adoption of the new and revised accounting standards did
not have any significant impact on its Financial Statements.
Further details of the Operational Risks and how the
Company manages them are set out on pages 33 to
34 of this Annual Report.
Internal Audit
The internal audit function of the Company is performed
by the Group Internal Audit Department comprising
suitably qualified and experienced staff, and is headed by
the Group Internal Audit Officer. She reports functionally
to the Chairman of the AC. The Company Secretary is the
Secretary of the AC.
vi) Whistle Blowing Policy
The Whistle Blowing Policy provides a mechanism for
employees to raise concerns, through confidential disclosure
channels, about possible improprieties in financial reporting
or other improper conduct. All staff are given company
handbooks detailing how they can go about raising their
concerns. Incidents can be reported through a direct link
to the AC, the Chief Executive Officer, the Group Human
Resource Officer or the Group Internal Audit Officer, and
which is available on the Group’s intranet. All reported
incidents will be investigated and dealt with promptly
and thoroughly.
The Internal Audit Department adopts a risk-based
approach in its continuous audit. It provides an independent
and objective evaluation of the internal control systems
and corporate governance processes of the Company in
accordance with the audit plan as approved by the
AC. Any material non-compliance or lapses in internal
controls are reported to the AC for recommendations for
improvements.
A committee headed by an officer appointed by the Chief
Executive Officer will oversee all investigations and
appropriate action will be taken where required. In cases
where the relevant laws have been infringed, the relevant
regulatory authorities will be alerted. The AC will also be
informed of the outcome of all investigations.
The activities and organisational structure of the Internal
Audit Department are monitored and reviewed by the AC
periodically to ensure that the Internal Audit Department
has the necessary resources to adequately perform its
functions, and that there are no unjustified restrictions and
limitations placed on the performance of its duties.
Where appropriate, rectification and prevention measures,
including putting in place additional internal control
measures and procedures will be undertaken to ensure that
such incidents are not repeated.
31
The Internal Audit Department has adopted and met the
Standards for the Professional Practice of Internal Auditing
set by The Institute of Internal Auditors.
is required by the Companies’ Act. The Articles of Association
of the Company provide for voting in person and by proxy
at the AGM of the Company. The Chairman of the various
Board Committees, as well as the External Auditors are
present to address any questions or feedback raised by
Shareholders at the AGM, including those pertaining to the
proposed resolutions before the resolutions are voted on.
4. COMMUNICATIONS WITH SHAREHOLDERS
Regular, Effective and Fair Communications with
Shareholders
The Company’s Investor Relations team regularly engages
Shareholders and investors, keeping them informed of key
corporate developments, as well as trends within the industry.
Each issue or matter requiring Shareholders’ approval is
tabled as a separate and distinct resolution.
INTERESTED PERSON TRANSACTION
Communication with Shareholders is conducted through
announcements to the SGX, press releases, press and
analyst briefings after the announcement of the fullyear results, as well as the posting of announcements and
releases on the Company’s regularly updated website at
www.sbstransit.com.sg. Investors may send in their
requests or queries through the feedback form provided in
the website.
Listing Manual – Rule 907
Aggregate value of all Interested
Person transactions during the
financial year under review
(excluding transactions less than $100,000
and transactions
conducted under Shareholders’ mandate
pursuant to Rule 920)
Name of Interested Person
The Company does not participate in selective disclosure
in the communication of material information.
Communication with the SGX is handled by the Company
Secretary, while communication with Shareholders, analysts
and fund managers is handled by the Group Corporate
Communications Officer. Specific guidelines have been laid
down for compliance in respect of all public communication.
In addition, the Company has also put in place operational
procedures to respond promptly to queries from the SGX
on any unusual trading activities in its securities.
ComfortDelGro Corporation
Limited and associates
$’mil
5.4
The aggregate value of the above transactions does not
include the aggregate value of $2.0 million from the renewal
of the Licence Agreements disclosed in the Introductory
Document of the Company dated 3 December 1997. These
transactions relate to leasing charges paid to DelGro
Corporation Limited and ComfortDelGro Corporation
Limited for the use of the premises.
Shareholders’ Participation at Annual General Meeting
Shareholders are informed of Shareholders’ Meetings through
notices published in the newspapers and reports sent to
all Shareholders. The Notice of AGM will be publicised
28 days before the AGM is held – two weeks earlier than
There is no Shareholders’ mandate for Interested Person
transactions pursuant to Rule 920 of the Listing Manual.
32
RISK MANAGEMENT
THE COMPANY RECOGNISES THAT RISK
IS AN INHERENT PART OF EVERY BUSINESS,
AND THE MANAGEMENT OF THESE RISKS IS
AN IMPORTANT ASPECT IN ENHANCING
SHAREHOLDER VALUE.
standards, we manage our operations effectively to ensure
that these are met, thereby reducing significantly the risk
of licences being withdrawn.
The Company’s risk management process involves
identifying, measuring, monitoring and managing these
risks, and in turn, establishing a sound and effective risk
management framework in addressing them. The key risks
faced by the Company, the relevant mitigating factors and
how they are managed are set out below.
OPERATIONAL RISKS
Safety
A key operating risk is the safety and security of our
passengers, our staff and the public. Managing this risk is
the cornerstone of the Company’s safety and security plan.
Safety awareness programmes are promoted to instil a safety
and security conscious culture in our staff at all levels. Safety
audits are conducted regularly as part of our management
and review programme to ensure that safety standards are
maintained at a high level. For our Bus and Rail Businesses,
the Company also works closely with the relevant authorities
to ensure that the security of our bus and train services and
facilities are not compromised. Regular exercises are carried
out internally, as well as with external agencies. Security
guards are also engaged to patrol our facilities and members
of the public are encouraged to look out for suspicious
objects or persons.
ECONOMIC RISKS
Macro economic conditions may impact the Company’s
business in terms of demand for our services and the cost of
providing these services. To manage these risks, we closely
monitor demand trends and operating margins through
budgeting and forecasting processes. Expenses are monitored
and continuously managed in the light of revenue patterns
and changing market environments. Revenue risks are
also mitigated by diversifying revenue streams to noncommuter sources.
REGULATORY RISKS
The Company operates in regulated environment. In view
of this, there are regulatory risks which include that of
changes to fare, service standards, licences to operate and
transport policies. These are stipulated by the relevant
regulatory authorities. In managing these risks, the Company
works closely with the relevant regulatory authorities as
part of its risk management process to ensure that the views
of our commuters, customers and stakeholders are well
represented. Where fares are concerned, there is a mechanism
in place for applications to be made to the regulatory
authority for increases. So long as these are fully justified,
fare increases are favourably considered. As for service
Environmental
Accidents, natural events and deliberate assaults by external
parties are all possible ways an organisation can cause
pollution or other environmental risks. In order to limit,
and hopefully prevent these situations, we engage in active
environmental risk management, ensuring that we target
the problems that could arise and implement a system of
metrics that help with prevention. For example, we have
put in place systems and processes that ensure that fuel
33
RISK MANAGEMENT
and approval in accordance with the Group’s financial
authority limits. Tight control on hiring is also exercised
through headcount budgets.
leakage is minimised in all our operations. We also carefully
audit the use of dangerous and harmful chemicals in our
businesses. Other ways in which we work to protect the
environment can be found in the Sustainability Report
section of this Annual Report.
Audit Process
The Internal and External Auditors conduct reviews in
accordance with their audit plans to assess the effectiveness
of the internal controls and risks management. Noncompliance or recommendations for improvement are reported
to the Audit Committee, which reviews the effectiveness of
the actions taken by Management to mitigate the risks. In
the course of their audit, the Internal and External Auditors
will also highlight to the Audit Committee and Management,
areas where there are material deficiencies and weaknesses,
or the occurrence or potential occurrence of significant risk
events, and the mitigating measures and treatment plans
will be proposed accordingly.
BUSINESS CONTINUITY RISKS
Operating in an environment with potential threats of
terrorism, epidemic outbreaks and information systems
failure, the Management has put in place Business Continuity
Management Plans to mitigate the risks of interruption and
catastrophic loss to its operations and information database
arising from such potential threats.
FINANCIAL RISKS
The Company has well-established internal controls to
safeguard its assets. It regularly reviews the effectiveness of
the system of internal controls to limit, mitigate and monitor
identified risks, and considers the enhancements of these
controls as an integral part of its risk management framework.
There are systems in place for safeguarding of assets and
they include the following:
Whistle Blowing Policy
A Whistle Blowing Policy is also put in place to provide
a mechanism for employees to raise concerns, through
confidential disclosure channels, about possible
improprieties in financial reporting or other improper
conduct. All cases are investigated and appropriate action
taken where required.
Financial Authority Limits
Comprehensive and specific financial authority limits are
put in place for capital expenditure, operating expenses,
treasury matters, direct investments, revenue tender
participation and disposal and write-off of assets. These
authority limits are delegated based on the organisational
hierarchy in the Company, with the Board retaining the
ultimate authority. Any expenditure exceeding the highest
authority limit is referred to the Board for approval.
Financial Risk Management
The main areas of financial risks faced by the Company
are foreign exchange rate risk, interest rate risk, credit risk,
liquidity risk and fuel price risk. It is the Company’s policy
not to participate in financial derivative instruments,
except for use as hedging instruments, where appropriate.
Management oversees financial risk management and
regularly reviews its policy governing risk management
practices.
Budgetary Control
A robust and challenging Annual Budget is prepared
and approved by the Board prior to the commencement of
each new financial year. Variations between actual and
budgeted performance are reviewed and justifications
provided, if material. This is done on a monthly basis.
Specific approvals are also required for unbudgeted
expenditures exceeding a relevant threshold. In addition,
the capital expenditure budget is approved in principle by
the Board when the Annual Budget is approved. Each
capital expenditure is still subject to rigorous justification
A detailed description of the financial risks and how the
Company manages them are set out in the Notes to the
Financial Statements on pages 84 to 88.
Investment Risks
Each new investment proposal is objectively evaluated on
its fit to the corporate strategy and investment objective.
This risk assessment includes macro and project specific
34
RISK MANAGEMENT
risks analysis encompassing rigorous due diligence, financial
modelling and sensitivity analysis on key investment
assumptions and variables.
To ensure that the rate of return on any new investment or
business opportunity commensurates with the risk exposure
taken, apart from undertaking a detailed feasibility study,
the new investment opportunity is evaluated by Management
in terms of (a) return on investment; (b) pay back period;
(c) cash flow generation; (d) potential for internal and
external growth; (e) investment climate; and (f) political
stability.
HUMAN RESOURCE RISKS
The Company’s ability to operate at full efficiency
depends on the quality, motivation and management of
its staff. To this end, we have in place a system of risk
management which focuses on several key areas, specifically
succession planning, recruitment, performance management,
compensation and benefits, training and development,
employee conduct and supervision, as well as occupational
health and safety. The Company aims to ensure that
employees are selected based on merit, understand their
responsibilities and are given access to necessary training.
At all times, a positive and constructive working climate
based on strong tripartite relations is fostered. All terms
and conditions of employment, along with policies and
procedures comply with the relevant legislations.
PROPERTY AND LIABILITY RISKS
The Company’s exposure to property and liability risks is
constantly being monitored and reviewed. Together with
external risk management consultants, the Company ensures
sufficiency of coverage and seeks to maintain an optimal
balance between risks that are being retained internally and
risks that are being placed out with underwriters.
35
FINANCIAL CALENDAR
2009
12 February 2009
Announcement of 2008 Full Year Results
Annual General Meeting
27 April 2009
Announcement of 1st Quarter 2009 Results
13 May 2009
Payment of 2008 final dividend (3.60 cents/share)
15 May 2009
13 August 2009
Announcement of 2nd Quarter 2009 Results
7 September 2009
Payment of 2009 interim dividend (4.50 cents/share)
11 November 2009
Announcement of 3rd Quarter 2009 Results
2010
Announcement of 2009 Full Year Results
10 February 2010
Annual General Meeting
28 April 2010
Announcement of 1st Quarter 2010 Results
14 May 2010*
17 May 2010
Payment of 2009 final dividend (4.30 cents/share)
(Subject to Shareholders’ approval at the forthcoming Annual General Meeting)
Announcement of 2nd Quarter 2010 Results
13 August 2010*
Announcement of 3rd Quarter 2010 Results
11 November 2010*
* Provisional – Updates will be posted at www.sbstransit.com.sg.
36
FINANCIAL STATEMENTS
Contents
38
44
45
46
Report of the Directors
Statement of Directors
Independent Auditors’ Report to
the Members of SBS Transit Ltd
Statements of Financial Position
48 Group Income Statement
49 Group Comprehensive Income Statement
50 Statements of Changes in Equity
52 Group Cash Flow Statement
53Notes to the Financial Statements
37
REPORT OF THE DIRECTORS
The Directors present their annual report together with the audited consolidated financial statements of the Group
for the Financial Year ended 31 December 2009 and the statement of financial position and statement of changes in equity
of the Company as at 31 December 2009.
1 DIRECTORS
The Directors of the Company in office at the date of this report are:
Lim Jit Poh
(Chairman)
Kua Hong Pak
(Deputy Chairman)
Gan Juay Kiat
(Executive Director, appointed on 1 March 2009)
Cheong Yip Seng
Chin Harn Tong
John De Payva
Tan Kong Eng
Wee Siew Kim
2 ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE BENEFITS
BY MEANS OF THE ACQUISITION OF SHARES AND DEBENTURES
Neither at the end of the financial year nor at any time during the financial year did there subsist any arrangement
whose object is to enable the Directors of the Company to acquire benefits by means of the acquisition of shares
or debentures in the Company or any other body corporate, except for the options mentioned below.
3 DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES
The Directors of the Company holding office at the end of the financial year had no interests in the share capital and
debentures of the Company and its related corporations as recorded in the register of Directors’ shareholdings kept
by the Company under Section 164 of the Singapore Companies Act, Cap. 50, except as follows:
Names of Directors and
Companies in which
interests are held Shareholdings registered
in the names of Directors Shareholdings in which Directors
are deemed to have interest
At
At
1 January 2009 1 January 2009
or date of
At
At
or date of
At
At
appointment, 31 December 21 January appointment, 31 December 21 January
if later
2009 2010
if later 2009 2010
Interest in the Company
(a)Ordinary shares
Lim Jit Poh
200,000
200,000
200,000
-
-
Cheong Yip Seng
185,000
185,000
185,000
-
-
Chin Harn Tong
210,000
210,000
210,000
-
-
Tan Kong Eng
214,800
214,800
214,800
691,548
691,548
Wee Siew Kim
55,000
55,000
55,000
-
-
150,000
150,000
150,000
-
-
38
691,548
-
3 DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES (Cont’d)
Names of Directors and
Companies in which
interests are held Shareholdings registered
in the names of Directors Shareholdings in which Directors
are deemed to have interest
At
At
1 January 2009 1 January 2009
or date of
At
At
or date of
At
At
appointment, 31 December 21 January appointment, 31 December 21 January
if later
2009 2010
if later 2009 2010
Interest in the Company (Cont’d)
(b)Options to subscribe
for ordinary shares
Lim Jit Poh
300,000
400,000
400,000
-
-
Kua Hong Pak
450,000
495,000
495,000
-
-
Gan Juay Kiat
90,000
240,000
240,000
-
-
Cheong Yip Seng
150,000
200,000
200,000
-
-
Chin Harn Tong
195,000
260,000
260,000
-
-
John De Payva
295,000
360,000
360,000
-
-
Tan Kong Eng
150,000
200,000
200,000
-
-
Wee Siew Kim
195,000
260,000
260,000
-
-
180,000
245,000
245,000
-
-
-
Interest in ultimate holding company,
ComfortDelGro Corporation Limited (a)Ordinary shares
Lim Jit Poh
144,425
844,425
844,425
-
-
Kua Hong Pak
2,824,530 2,824,530 2,824,530
-
-
Tan Kong Eng
64,162
64,162
64,162
9,244,095
9,244,095 9,244,095
100,000
100,000
100,000
-
-
(b)Options to subscribe
for ordinary shares
Lim Jit Poh
940,000 1,180,000 1,180,000
-
-
Kua Hong Pak
4,800,000 6,000,000 6,000,000
-
-
Gan Juay Kiat
400,000
570,000
570,000
-
-
470,000
590,000
590,000
-
-
-
Interest in related company,
VICOM Ltd (a)Ordinary shares
Lim Jit Poh
190,000
190,000
190,000
-
-
Kua Hong Pak
54,000
54,000
54,000
-
-
Cheong Yip Seng
10,000
10,000
10,000
-
-
39
-
4 DIRECTORS’ RECEIPT AND ENTITLEMENT TO CONTRACTUAL BENEFITS
Since the beginning of the financial year, no Director of the Company has received or become entitled to receive a
benefit which is required to be disclosed under Section 201(8) of the Singapore Companies Act, Cap. 50, by reason of
a contract made by the Company or a related corporation with the Director or with a firm of which he is a member, or
with a company in which he has a substantial financial interest except as disclosed in the financial statements. Certain
Directors received remuneration from related corporations in their capacity as Directors and/or executives of those
related corporations.
5 SHARE OPTIONS
SBS Transit Share Option Scheme (“SSOS”)
a) The SSOS was approved by the shareholders of the Company on 9 June 2000. The SSOS is administered by
the Remuneration Committee comprising Messrs Chin Harn Tong, John De Payva and Lim Jit Poh.
b) The SSOS provides the Company with a means whereby (i) employees of the Company and its subsidiary
of the rank of Executive and above, and (ii) certain categories of persons who are not employees but who
work closely with the Company and its subsidiary, are given an opportunity to participate in the equity of
the Company. A person who is a controlling shareholder of the Company or an associate (as defined in the
Singapore Exchange Securities Trading Listing Manual) of a controlling shareholder of the Company is not
eligible to participate in the SSOS.
c) Under the SSOS, an option entitles the option holder to subscribe for a specific number of new ordinary
shares at a subscription price determined with reference to the market price of the shares at the time of the
grant of the option. The subscription price and/or number of shares comprised in an option may be adjusted
in certain events under the rules of the SSOS. The consideration for the grant of an option is $1.00. The
option may be exercised at any time after the first anniversary of the date of grant but before the tenth
anniversary (fifth anniversary for options granted to non-executive Directors) of the date of grant of that
option or such shorter period as determined by the Remuneration Committee. The shares under option may
be exercised in whole or in part on the payment of the relevant subscription price. Options granted will lapse
when the option holder ceases to be a full-time employee or Director of the Company, subject to certain
exceptions at the discretion of the Remuneration Committee.
d) Participants of the SSOS are not restricted from participating in other share option schemes, whether
implemented by the Company or its subsidiary or otherwise.
40
5 SHARE OPTIONS (Cont’d)
e) Particulars of unissued shares under options granted pursuant to the SSOS, options exercised and cancelled/
lapsed during the financial year, and options outstanding as at 31 December 2009 are as follows:
Date of grant
26 September 2000
6 September 2001
22 August 2003
10 December 2003
19 July 2004
19 July 2004
24 February 2005
24 February 2005
28 July 2005
28 July 2005
18 November 2005
18 November 2005
13 July 2006
13 July 2006
22 June 2007
22 June 2007
25 June 2008
25 June 2008
25 June 2009
25 June 2009
Number of options to subscribe for ordinary shares
Outstanding
Outstanding Subscription
at Cancelled/
at
price
1 January 2009
Granted Exercised
Lapsed 31 December 2009
per share
Expiry date
88,000
123,000
85,000
35,000
180,000
45,000
506,250
80,000
445,250
77,500
378,750
77,500
1,387,500
535,000
2,092,500
550,000
2,140,000
550,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,212,500
550,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(18,750)
(45,000)
-
-
-
-
-
-
-
-
(92,500)
-
(52,500)
-
(52,500)
-
88,000
123,000
85,000
35,000
161,250
-
506,250
80,000
445,250
77,500
378,750
77,500
1,387,500
535,000
2,000,000
550,000
2,087,500
550,000
2,160,000
550,000
$1.59
$1.60
$1.29
$1.22
$1.60
$1.60
$2.29
$2.29
$2.23
$2.23
$2.16
$2.16
$2.15
$2.15
$3.40
$3.40
$2.18
$2.18
$1.58
$1.58
9,376,250
2,762,500
-
(261,250)
11,877,500
26 September 2010
6 September 2011
22 August 2013
10 December 2013
19 July 2014
19 July 2009
24 February 2015
24 February 2010
28 July 2015
28 July 2010
18 November 2015
18 November 2010
13 July 2016
13 July 2011
22 June 2017
22 June 2012
25 June 2018
25 June 2013
25 June 2019
25 June 2014
The options outstanding as at 31 December 2009 includes 660,000 options granted to former employees of
the Company, who have been granted an extension of time from their respective dates of retirement, by the
Remuneration Committee to exercise their outstanding options.
41
5 SHARE OPTIONS (Cont’d)
f ) Details of the SSOS options granted to Directors of the Company during the financial year and since the
commencement of the SSOS up to 31 December 2009 were as follows:
Number of options to subscribe for ordinary shares
Aggregate options Aggregate options
Director
Lim Jit Poh
Kua Hong Pak
Gan Juay Kiat
Cheong Yip Seng
Chin Harn Tong
John De Payva
Tan Kong Eng
Wee Siew Kim
Granted during
granted since the exercised since the
the financial
commencement
commencement Aggregate options
year ended
of scheme to
of scheme to outstanding as at
31 December 2009 31 December 2009 31 December 2009 31 December 2009
100,000
90,000
150,000
50,000
65,000
65,000
50,000
65,000
65,000
780,000
690,000
240,000
455,000
470,000
495,000
410,000
515,000
475,000
380,000
150,000
-
255,000
210,000
135,000
210,000
255,000
230,000
400,000
495,000
240,000
200,000
260,000
360,000
200,000
260,000
245,000
The terms of the options granted to the Directors during the financial year are disclosed in paragraph 5 (c)
above.
g)None of the options granted under the SSOS included a discount feature to the market price of the
shares at the time of grant. No participants to the SSOS are controlling shareholders of the Company and
its associate.
h)None of the Directors or employees of the Company and its subsidiary received 5% or more of the total
number of options available under the SSOS, for the financial year ended 31 December 2009.
6
AUDIT COMMITTEE
At the date of this report, the Audit Committee comprises three non-executive and independent Directors:
The Audit Committee carried out its functions in accordance with Section 201B(5) of the Singapore Companies Act,
Cap. 50.
In performing its functions, the Audit Committee reviewed the overall scope of both internal and external audits
and the assistance given by the Company’s officers to the auditors. It met with the Company’s internal and external
auditors to discuss the scope and results of their respective audits. The Audit Committee has reviewed the independence
of the auditors, Deloitte & Touche LLP, including the scope of the non-audit services performed and confirmed that
the auditors are independent.
Wee Siew Kim
Chin Harn Tong
Tan Kong Eng
(Chairman)
42
6 AUDIT COMMITTEE (Cont’d)
In addition, the Audit Committee reviewed the financial statements of the Group and the Company before their
submission to the Board of Directors of the Company.
The Audit Committee has recommended to the Board of Directors, the nomination of Deloitte & Touche LLP for
re-appointment as auditors of the Company at the forthcoming Annual General Meeting of the Company.
7 AUDITORS
The auditors, Deloitte & Touche LLP, have expressed their willingness to accept re-appointment.
ON BEHALF OF THE DIRECTORS
Lim Jit Poh
Chairman
Kua Hong Pak
Deputy Chairman
Singapore
10 February 2010
43
STATEMENT OF DIRECTORS
In the opinion of the Directors, the consolidated financial statements of the Group and the statement of financial position
and statement of changes in equity of the Company set out on pages 46 to 89 are drawn up so as to give a true and fair
view of the state of affairs of the Group and of the Company as at 31 December 2009, and of the results, changes in
equity and the cash flows of the Group, and changes in equity of the Company for the financial year ended on that date
and at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts
as and when they fall due.
ON BEHALF OF THE DIRECTORS
Lim Jit Poh
Chairman
Kua Hong Pak
Deputy Chairman
Singapore
10 February 2010
44
INDEPENDENT AUDITORS’ REPORT
TO THE MEMBERS OF SBS TRANSIT LTD
We have audited the accompanying financial statements of SBS Transit Ltd (the “Company”) and its subsidiary
(the “Group”) which comprise the statements of financial position of the Group and the Company as at 31 December
2009, and the income statement, comprehensive income statement, statement of changes in equity and cash flow
statement of the Group and the statement of changes in equity of the Company for the year then ended, and a summary
of significant accounting policies and other explanatory notes, as set out on pages 46 to 89.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with
the provisions of the Singapore Companies Act, Cap. 50 (the “Act”) and Singapore Financial Reporting Standards.
This responsibility includes: devising and maintaining a system of internal accounting controls sufficient to provide a
reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are
properly authorised and that they are recorded as necessary to permit the preparation of true and fair profit and loss
accounts and balance sheets and to maintain accountability of assets; selecting and applying appropriate accounting
policies; and making accounting estimates that are reasonable in the circumstances.
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in
accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements
and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to
design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies
used and the reasonableness of accounting estimates made by Management, as well as evaluating the overall presentation
of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our audit opinion.
Opinion
In our opinion,
a) the consolidated financial statements of the Group and the statement of financial position and statement of changes
in equity of the Company are properly drawn up in accordance with the provisions of the Act and Singapore Financial
Reporting Standards so as to give a true and fair view of the state of affairs of the Group and of the Company as at
31 December 2009 and of the results, changes in equity and cash flows of the Group and the changes in equity of
the Company for the year ended on that date; and
b) the accounting and other records required by the Act to be kept by the Company have been properly kept in accordance
with the provisions of the Act.
Deloitte & Touche LLP
Public Accountants and
Certified Public Accountants
Singapore
10 February 2010
45
STATEMENTS OF FINANCIAL POSITION
31 DECEMBER 2009
Note
The Group
2009
2008
$’000
$’000
The Company
2009
2008
$’000
$’000
ASSETS
Current assets
Short-term deposits and bank balances
5
6,057
32,853
6,057
32,853
Held-for-trading investments
6
- 32,004
- 32,004
Available-for-sale investments
7
- 5,018
- 5,018
Trade receivables
8
8,481
6,964
8,481
6,964
Other receivables and prepayments
9
32,191
30,508
32,191
30,508
Inventories
30,598
26,812
30,598
26,812
Total current assets
77,327
134,159
77,327
134,159
Non-current assets
Subsidiary
10
- - - Associate
11
1,587
1,268
1,280
1,280
7
15,320
14,480
15,320
14,480
Vehicles, premises and equipment
12
491,704
366,555
491,704
366,555
Total non-current assets
508,611
382,303
508,304
382,315
Total assets 585,938
516,462
585,631
516,474
46
STATEMENTS OF FINANCIAL POSITION
31 DECEMBER 2009
Note
The Group
2009
2008
$’000
$’000
The Company
2009
2008
$’000
$’000
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables
13
135,272
102,200
135,272
102,200
Trade payables for buses
43,315
47,865
43,315
47,865
Deposits received – current portion
14
1,549
1,668
1,549
1,668
Insurance premiums payable and
provision for accident claims
15
35,321
33,423
35,321
33,423
Income tax payable
2,627
2,973
2,627
2,973
Total current liabilities
218,084
188,129
218,084
188,129
Non-current liabilities
Deposits received
14
2,397
1,763
2,397
1,763
Deferred tax liabilities
16
30,772
23,010
30,772
23,010
Provision for service benefits
and long service awards
17
12,509
12,237
12,509
12,237
Fuel price equalisation account
34,075
34,075
34,075
34,075
Total non-current liabilities
79,753
71,085
79,753
71,085
Capital and reserves
Share capital
18
92,310
92,310
92,310
92,310
Capital reserves
19
1,391
263
1,391
263
Accumulated profits
194,400
164,675
194,093
164,687
Total equity
288,101
257,248
287,794
257,260
Total liabilities and equity
585,938
516,462
585,631
516,474
See accompanying notes to the financial statements.
47
GROUP INCOME STATEMENT
YEAR ENDED 31 DECEMBER 2009
Note
Revenue 20
Staff costs
21
Repairs and maintenance
Fuel and electricity costs
Premises costs
Depreciation expense
Other operating expenses
Total operating expenses
Operating profit
22
The Group
2009
2008
$’000
$’000
697,083
731,330
(289,113)
(96,420)
(121,401)
(30,356)
(40,483)
(57,107)
(634,880)
(287,743)
(92,609)
(184,114)
(30,744)
(31,515)
(57,524)
(684,249)
62,203
47,081
Net income from investments
23
808
Share of profit in associate
11
319
Profit before taxation
63,330
Taxation
24
(8,718)
Profit attributable to shareholders
54,612
Earnings per share (in cents):
Basic
25
17.75
Diluted
25
17.74
48
2,896
304
50,281
(9,701)
40,580
13.19
13.19
GROUP COMPREHENSIVE INCOME STATEMENT
The Group
2009
2008
$’000
$’000
Profit attributable to shareholders
54,612
40,580
Other comprehensive income:
Fair value gain (loss) on available-for-sale investments
822
(925)
Total comprehensive income for the year attributable to shareholders of the company
55,434
39,655
49
STATEMENTS OF CHANGES IN EQUITY
Group
Attributable to shareholders of the Company
Share
Capital
capital
reserves Accumulated
Total
(Note 18)
(Note 19)
profits equity
$’000
$’000
$’000
$’000
Balance at 1 January 2008
91,324
954
143,260
235,538
Total comprehensive income for the year
- (925)
40,580
39,655
Recognition of share-based payments
-
291
-
291
Exercise of share options
986
(23)
-
963
Payment of dividends (Note 30)
-
-
Others
-
(34)
Balance at 31 December 2008
92,310
263
- 822
-
319
-
-
Others
-
(13)
92,310
1,391
50
(19,232)
67
33
164,675
257,248
54,612
55,434
(19,232)
(24,925)
319
(24,925)
38
25
194,400
288,101
STATEMENTS OF CHANGES IN EQUITY
Company
Share
Capital
capital
reserves Accumulated
(Note 18)
(Note 19)
profits $’000
$’000
$’000
Balance at 1 January 2008
91,324
954
143,576
- (925)
40,276
-
986
-
-
Others
-
(34)
235,854
39,351
291
-
291
(23)
-
963
92,310
263
- 822
-
319
-
-
Others
-
(13)
92,310
1,391
51
Total
equity
$’000
(19,232)
67
33
164,687
257,260
54,293
55,115
(19,232)
(24,925)
319
(24,925)
38
25
194,093
287,794
GROUP CASH FLOW STATEMENT
2009
$’000
Operating activities
63,330
Adjustments for:
40,483
Share-based payment expense
319
Net loss (gain) on disposal of held-for-trading investments
5
Net gain on fair value changes of held-for-trading investments
(1)
Net gain on disposal of vehicles and equipment
(1,828)
Interest income
(812)
(319)
Operating cash flows before movements in working capital
101,177
Trade receivables
(1,517)
Other receivables and prepayments
(1,904)
Inventories
(3,786)
Held-for-trading investments
32,000
Trade payables
31,345
Trade payables for buses
(4,550)
Deposits received
515
Provision for service benefits and long service awards
272
Insurance premiums payable and provision for accident claims
1,898
Cash generated from operations
155,450
Income tax paid
(1,302)
Net cash from operating activities
154,148
Investing activities
Interest received
1,352
Proceeds from disposal of:
Vehicles and equipment
1,866
5,000
Purchase of vehicles, premises and equipment
(164,262)
Net cash used in investing activities
(156,044)
Financing activities
Proceeds from share issue
Dividends paid
(24,925)
Others
25
Net cash used in financing activities
(24,900)
Net decrease in cash and cash equivalents
(26,796)
Cash and cash equivalents at beginning of year
32,853
Cash and cash equivalents at end of year (Note 5)
6,057
52
2008
$’000
50,281
31,515
291
(168)
(79)
(1,687)
(2,649)
(304)
77,200
3,484
(7,551)
(5,173)
42,014
(1,181)
35,471
935
1,681
355
147,235
(12,006)
135,229
3,030
1,771
15,000
(146,667)
(126,866)
963
(19,232)
33
(18,236)
(9,873)
42,726
32,853
NOTES TO THE FINANCIAL STATEMENTS
31 DECEMBER 2009
1 GENERAL
The Company (Registration No. 199206653M) is incorporated in Singapore with its registered office and principal
place of business at 205 Braddell Road, Singapore 579701. The Company is listed on the Official List of the Singapore
Exchange Securities Trading Limited.
The principal activities of the Company are those of the provision of public transport services, namely bus and rail
services. The subsidiary is currently inactive.
The financial statements are expressed in Singapore dollars and all values are rounded to the nearest thousand ($’000)
except when otherwise indicated.
The consolidated financial statements of the Group for the financial year ended 31 December 2009 and the statement
of financial position of the Company as at 31 December 2009 were authorised for issue by the Board of Directors on
10 February 2010.
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING - The financial statements have been prepared in accordance with the historical cost
basis except as disclosed in the accounting policies below, and are drawn up in accordance with the provisions of the
Singapore Companies Act, Cap. 50 and Singapore Financial Reporting Standards (“FRSs”).
ADOPTION OF NEW AND REVISED STANDARDS - In the current financial year, the Group has adopted all
the new and revised FRSs and Interpretations of FRSs (“INT FRSs”) that are relevant to its operations and effective
for annual periods beginning on 1 January 2009.
The following are the new or amended FRSs that are relevant to the Group:
FRS 1
Presentation of Financial Statements (Revised)
Amendments to FRS 107
Improving Disclosures about Financial Instruments
FRS 108Operating Segments
The adoption of the above FRSs did not result in any changes to the Group’s accounting policies nor any significant
impact on the financial statements.
NEW ACCOUNTING STANDARDS AND INTERPRETATIONS NOT YET ADOPTED - The Group has not
applied the following accounting standards (including its consequential amendments) that have been issued as at the
end of the reporting period but are not yet effective:
FRS 27 (Revised)
FRS 28 (Revised)
FRS 103 (Revised)
FRS 107
Amendments to FRS 39
-
-
-
-
-
Consolidated and Separate Financial Statements
Investment in Associates
Business Combination
Financial Instruments: Disclosure regarding Reclassification of Financial Assets
Financial Instruments: Recognition and Measurement
These standards are not expected to have any material impact on the Group’s financial statements when they
are adopted.
53
31 DECEMBER 2009
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)
BASIS OF CONSOLIDATION - The consolidated financial statements incorporate the financial statements of the
Company and an entity controlled by the Company (its subsidiary) made up to 31 December of each financial year.
Control is achieved when the Company has the power to govern the financial and operating policies of an entity so as
to obtain benefits from its activities.
The results of subsidiary acquired or disposed of during the year are included in the Group comprehensive income
statement from the effective date of acquisition or up to the effective date of disposal, as appropriate.
Where necessary, adjustments are made to the financial statements of the subsidiary to bring its accounting policies
in line with those consistently used by the Group.
All intra-group transactions, balances, income and expenses are eliminated on consolidation.
In the statement of financial position of the Company, investments in subsidiary and associate are carried at cost less any
provision for impairment in net recoverable value that has been recognised in profit or loss.
BUSINESS COMBINATIONS - The acquisition of subsidiary is accounted for using the purchase method. The cost
of the acquisition is measured at the aggregate of the fair values, at the date of acquisition, of assets given, liabilities
incurred or assumed, and equity instruments issued by the Group in exchange for control of the acquiree, plus any
costs directly attributable to the business combination. The acquiree’s identifiable assets, liabilities and contingent
liabilities that meet the conditions for recognition under FRS 103 Business Combinations are recognised at their fair
values at the acquisition date, except for non-current assets (or disposal groups) that are classified as held-for-sale in
accordance with FRS 105 Non-current Assets Held for Sale and Discontinued Operations, which are recognised and
measured at fair value less costs to sell.
FINANCIAL INSTRUMENTS - Financial assets and financial liabilities are recognised on the Group’s statement of
financial position when the Group becomes a party to the contractual provisions of the instrument.
Effective interest method
The effective interest method is a method of calculating the amortised cost of a financial instrument and of allocating
interest income or expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated
future cash receipts or payments through the expected life of the financial instrument, or where appropriate, a shorter
period. Income and expense is recognised on an effective interest basis for debt instruments.
Financial assets
Cash and cash equivalents
Cash and cash equivalents comprise bank balances and short-term deposits that are readily convertible to a known
amount of cash and are subject to an insignificant risk of changes in value.
Investments
Investments are recognised and de-recognised on a trade date basis where the purchase or sale of an investment is
under a contract whose terms require delivery of the investment within the time frame established by the market
concerned, and are initially measured at fair value, plus directly attributable transaction costs except for those financial
assets classified as at fair value through profit or loss which are initially measured at fair value.
Investments are classified into the following specified categories: held-for-trading investments at fair value through
profit or loss (“FVTPL”) and available-for-sale investments. The classification depends on the nature and purpose of
the investment and is determined at the time of initial recognition.
54
31 DECEMBER 2009
a) Financial assets at fair value through profit or loss (“FVTPL”)
Held-for-trading investments are classified as FVTPL where it has been acquired principally for the purpose
of selling in the near future. Hedging instruments that are not designated for a hedge relationship and/or are
ineffective in a hedge relationship are classified as FVTPL. Financial assets that are classified as FVTPL are
stated at fair value, with any resultant gain or loss recognised in profit or loss.
b) Available-for-sale investments
Certain investments held by the Group are classified as being available-for-sale and are stated at fair value. Gains
and losses arising from changes in fair value are recognised in other comprehensive income with the exception of
provision for impairment, interest calculated using the effective interest method and foreign exchange gains and
losses on monetary assets which are recognised directly in profit or loss. Where the investment is disposed of or
is determined to be impaired, the cumulative gain or loss previously recognised in other comprehensive income
and revaluation reserve is included in profit or loss for the period.
Trade and other receivables
Trade and other receivables that have fixed or determinable payments that are not quoted in an active market are
classified as “trade and other receivables”. Trade and other receivables are measured at initial recognition at fair value,
and are subsequently measured at amortised cost using the effective interest method less provision for impairment.
Interest is recognised by applying the effective interest method, except for short-term receivables when the recognition
of interest would be immaterial.
Provision for impairment of financial assets
Financial assets, other than those at FVTPL, are assessed for indicators of provision for impairment at each end of
the reporting period. Financial assets are reduced by the provision for impairment where there is objective evidence
that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated
future cash flows of the investment have been reduced by the provision for impairment.
The carrying amount of the financial asset is reduced by the provision for impairment directly for all financial
assets with the exception of trade and other receivables where the carrying amount is reduced through the use of an
allowance account. When a trade and other receivable is uncollectible, it is written off against the allowance account.
Subsequent recoveries of amounts previously written off are credited to profit or loss. Changes in the carrying amount
of the allowance account are recognised in profit or loss.
With the exception of available-for-sale equity instruments, if, in a subsequent period, the amount of provision
for impairment decreases and the decrease can be related objectively to an event occurring after the provision for
impairment was recognised, the previously recognised provision for impairment is reversed through profit or loss
to the extent the carrying amount of the investment at the date the provision for impairment is reversed does not
exceed what the amortised cost would have been had the provision for impairment not been recognised.
In respect of available-for-sale equity instruments, any subsequent increase in fair value after an impairment loss is
recognised in other comprehensive income.
55
31 DECEMBER 2009
2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)
Financial liabilities and equity instruments
Classification as debt or equity
Financial liabilities and equity instruments issued by the Group are classified according to the substance of the
contractual arrangements entered into and the definitions of a financial liability and an equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of
its liabilities. Equity instruments are recorded at the proceeds received, net of direct issue costs.
Trade and other payables
Trade and other payables are initially measured at fair value, net of transaction costs, and are subsequently measured
at amortised cost, using the effective interest method, with interest expense recognised on an effective yield basis.
Hedging instruments and hedge accounting
The Group uses hedging instruments to manage its exposure to fuel price, interest rate and foreign exchange rate
risk. The Group uses hedging instruments such as forwards and options, to manage these risks. The use of hedging
instruments is governed by the Group’s policies which provide written principles on the use of financial instruments
consistent with the Group’s risk management strategy (see Note 29).
Hedging instruments are initially recognised at fair value on the contract date, and are subsequently remeasured to
their fair value at each end of the reporting period. The resulting gain or loss is recognised in profit or loss immediately
unless the hedging instrument is designated and effective as a hedging instrument, in which event the timing of
the recognition in profit or loss depends on the nature of the hedge relationship. The Group designates its hedging
instruments as either fair value hedges or cash flow hedges.
The fair value of hedging instrument is classified as a non-current asset or a non-current liability if the maturity
of the hedge relationship exceeds 12 months and as a current asset or current liability if the maturity of the hedge
relationship is within 12 months.
At the inception of the hedge relationship, the Group documents the relationship between the hedging instrument
and hedged item, along with its risk management objective and its strategy for undertaking various hedge transactions.
Furthermore, at the inception of the hedge and on an ongoing basis, the Group documents whether the hedging
instrument is highly effective in offsetting changes in fair values or cash flows of the hedged item.
The Group designates any interest rate swap for hedging of interest rate risk arising from borrowings as cash flow hedges.
Hedges of fuel price risk are designated as fair value hedges. Hedges of foreign currency risk of a firm commitment are
designated as fair value hedges.
Hedge accounting is discontinued when the Group revokes the hedging relationship, the hedging instrument expires
or is sold, terminated, or exercised, or no longer qualifies for hedge accounting.
Note 29(b) contains details of the fair values of the hedging instruments.
56
31 DECEMBER 2009
a) Fair value hedge
Changes in the fair value of hedging instruments that are designated and qualify as fair value hedges are recorded
in profit or loss immediately, together with any changes in the fair value of the hedged item that is attributable
to the hedged risk.
b) Cash flow hedge
The effective portion of changes in fair value of derivatives that are designated and qualify as cash flow hedges
are recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised
immediately in profit or loss as part of other gains and losses.
Amounts recognised in other comprehensive income and accumulated in equity are recognised in profit or loss
in the periods when the hedged item is recognised in profit or loss or when hedge accounting is discontinued.
LEASES - Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and
rewards of ownership to the lessee. All other leases are classified as operating leases.
The Group as lessee
Assets held under finance leases are recognised as assets of the Group at their fair value at the inception of the lease
or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included
in the statement of financial position as a finance lease obligation. Lease payments are apportioned between finance
charges and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of
the liability. Finance charges are charged directly to profit or loss in accordance with the Group’s general policy on
borrowing costs (see below). Contingent rentals are recognised as expenses in the periods in which they are incurred.
Rentals payable under operating leases are charged to profit or loss on a straight-line basis over the term of the
relevant lease. Contingent rentals arising under operating leases are recognised as an expense in the periods in which
they are incurred.
In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a
liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis over
the lease term.
The Group as lessor
Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial
direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased
asset and recognised on a straight-line basis over the lease term.
57
31 DECEMBER 2009
INVENTORIES - Inventories consist mainly of parts, accessories and consumable stores required for the operation
and maintenance of vehicles and certain equipment. Inventories are stated at the lower of cost and net realisable value.
Cost comprises cost of purchase and those costs that have been incurred in bringing the inventories to their present
location and condition. Cost is calculated using the weighted average method.
VEHICLES, PREMISES AND EQUIPMENT - Vehicles, premises and equipment are stated at cost, less accumulated
depreciation and any provision for impairment.
Capital projects comprising development and construction costs incurred during the period of construction are
carried at cost, less any recognised provision for impairment. Depreciation on these assets, on the same basis as other
vehicles, premises and equipment, commence when the assets are available for use.
Depreciation is charged so as to write off the cost of the assets, other than capital projects in progress, over the
estimated useful lives on a straight-line method, on the following bases:
Number of years
Buses
Bus grooming and other accessories (classified under buses)
Leasehold land and buildings Computers and automated equipment
Workshop machinery, tools and equipment
Motor vehicles
Furniture, fittings and equipment
17
5 to 8
over terms of leases which
are between 4 to 28 years
1 to 6
3 to 5
5 to 10
7
The estimated useful lives, residual values (where expected to be significant) and depreciation method are reviewed at
each year end, with the effect of any changes in estimate accounted for on a prospective basis.
The gain or loss arising on disposal or retirement of an item of vehicles, premises and equipment is determined as the
difference between the sales proceeds and the carrying amounts of the asset and is recognised in profit or loss.
Transfers of vehicles, premises and equipment within the ultimate holding company’s group of companies are stated
at cost less accumulated depreciation of the vehicles, premises and equipment transferred.
Fully depreciated vehicles, premises and equipment are retained in the financial statements until they are no longer
in use.
58
31 DECEMBER 2009
ASSOCIATES - An associate is an entity over which the Group has significant influence and that is neither a subsidiary
nor an interest in a joint venture. Significant influence is the power to participate in the financial and operating policy
decisions of the investee but is not control or joint control over those policies.
The results and assets and liabilities of associates are incorporated in these financial statements using the equity
method of accounting, except when the investment is classified as held-for-sale, in which case it is accounted for
under FRS 105 Non-current Assets Held for Sale and Discontinued Operations. Under the equity method, investments
in associates are carried in the Group’s statement of financial position at cost as adjusted for post-acquisition changes
in the Group’s share of the net assets of the associates, less any provision for impairment in the value of individual
investments. Losses of an associate in excess of the Group’s interest in that associate (which includes any long-term
interests that, in substance, form part of the Group’s net investment in the associate) are not recognised, unless the
Group has incurred legal or constructive obligations or made payments on behalf of the associate.
Any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets, liabilities
and contingent liabilities of the associate recognised at the date of acquisition is recognised as goodwill. The goodwill
is included within the carrying amount of the investment and is assessed for provision for impairment as part of the
investment. Any excess of the Group’s share of the net fair value of the identifiable assets, liabilities and contingent
liabilities over the cost of acquisition, after reassessment, is recognised immediately in profit or loss.
Where a Group entity transacts with an associate of the Group, profits and losses are eliminated to the extent of the
Group’s interest in the relevant associate.
IMPAIRMENT OF ASSETS - At each end of the reporting period, the Group reviews the carrying amounts of its
tangible assets, if any, to determine whether there is any indication of impairment. If any such indication exists, the
recoverable amount of the asset is estimated in order to determine the extent of the provision for impairment (if any).
Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable
amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market
assessments of the time value of money and the risks specific to the asset.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the
carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. A provision for impairment
is recognised immediately in profit or loss.
Where provision for impairment subsequently reverses, the carrying amount of the asset (cash-generating unit) is
increased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying amount
does not exceed the carrying amount that would have been determined had no provision for impairment been
recognised for the asset (cash-generating unit) in prior years. A reversal of a provision for impairment is recognised
immediately in profit or loss.
PROVISIONS - Provisions are recognised when the Group has a present obligation (legal or constructive) as a result
of a past event, it is probable that the Group will be required to settle the obligation, and a reliable estimate can be
made of the amount of the obligation.
59
31 DECEMBER 2009
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation
at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. Where
a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the
present value of those cash flows.
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third
party, the receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the
amount of the receivable can be measured reliably.
FUEL PRICE EQUALISATION ACCOUNT - At the direction of the Public Transport Council (“PTC”), a fuel
price equalisation account has been set up to account for diesel price and electricity tariff adjustment charge. In
accounting for diesel price and electricity tariff variation, reference is made to the diesel price and electricity tariff
(hereafter referred to as “reference diesel price and electricity tariff”) as determined by the PTC annually.
In the year when the actual diesel price and electricity tariff are below the reference diesel price and electricity tariff,
a fuel price equalisation charge is made in that year’s profit or loss to the extent that the outstanding balance in the
fuel price equalisation account does not exceed that year’s fuel consumption amount calculated at the reference diesel
price and electricity tariff.
In the year when the actual diesel price and electricity tariff are above the reference diesel price and electricity tariff,
the fuel price equalisation account previously set up can be drawn down in full or in part subject to:
a) the amount to be drawn down is limited to the extent that the balance outstanding in the fuel price equalisation
account after draw down, is at or above that year’s fuel consumption using the reference diesel price and
electricity tariff; or
b) upon an application by the Company and subject to the approval by PTC.
During the financial year, the fuel price equalisation account has been reclassified from current to non-current
liabilities. The comparative figures have been reclassified to conform with the current year’s presentation. The same
reclassification would apply for 2007.
PROVISION FOR ACCIDENT CLAIMS - Claims for accident, public liability and others are provided in the
financial statements based on the claims outstanding and the estimated amounts payable. It represents the best
estimate of the expenditure required to settle the Group’s obligation.
SERVICE BENEFITS - These comprise the following:
a) Retirement benefits - Under the Collective Agreement entered into by the Company with the Union, a retirement
benefit subject to a maximum of $3,000 is payable to a retiring employee on or after attaining the age of 62 years
and on completion of at least five years of service. Provision is made in the financial statements based on the
number of years of service rendered by qualifying employees.
b) Long service awards - Staff serving more than 15 years are entitled to long service awards of $250 for 15 years of
service, $350 for 20 years, $500 for 25 years and $700 for 30 years. Provision is made in the financial statements
based on the number of years of service rendered by qualifying employees.
60
31 DECEMBER 2009
The provision for retirement benefits and long service awards is discounted using the market yield of Singapore
Government Bonds at end of the reporting period.
c) Apart from the retirement benefits described in (a) above, the Company participates in a defined contribution
plan managed by the Singapore Government (“Singapore Central Provident Fund”). Payments made to the plan
are charged as an expense as they fall due.
d)Employee leave entitlements - Employee entitlements to annual leave are recognised when they accrue to
employees. A provision is made for the estimated liability for annual leave as a result of services rendered by
employees up to the end of the reporting period.
e) Share-based payments - The Company issues equity-settled share-based payments to certain employees and
directors. Equity-settled share-based payments are measured at fair value (excluding the effect of non marketbased vesting conditions) at the date of grant. The fair value determined at the grant date of the equity-settled
share-based payments is expensed on a straight-line basis over the vesting period, based on the Company’s
estimate of shares that will eventually vest.
Fair value is measured using the Black-Scholes pricing model. The expected life used in the model has been
adjusted, based on the best estimate, for the effects of non-transferability, exercise restrictions and behavioural
considerations.
GOVERNMENT GRANTS - Government grants are not recognised until there is reasonable assurance that the
Group will comply with the conditions attaching to them and the grants will be received. Government grants whose
primary condition is that the Group should purchase, construct or otherwise acquire non-current assets are recognised
by deducting the grant in arriving at the carrying amount of the asset.
Government grants in relation to expenses incurred are recognised as other operating income in the period in which
they become receivable.
REVENUE RECOGNITION - Revenue is measured at the fair value of the consideration received or receivable
and represents amounts receivable for services provided in the normal course of business, net of discounts and sales
related taxes.
Revenue from rendering of services, that are of a short duration, is recognised as and when services are completed.
Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate
applicable, which is the rate that discounts estimated future cash receipts through the expected life of the financial
asset to that asset’s net carrying amount.
Dividend income from investments is recognised when the shareholders’ rights to receive payment have been
established.
BORROWING COSTS - Borrowing costs are recognised in profit or loss in the period in which they are incurred.
61
31 DECEMBER 2009
INCOME TAX - Income tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the
comprehensive income statement because it excludes items of income or expense that are taxable or deductible in
other years and it further excludes items that are not taxable or tax deductible. The Group’s liability for current tax is
calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.
Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the
balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences
and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against
which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary
difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets
and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the
extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to
be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the
asset realised based on the tax rates (and tax laws) that have been enacted or substantively enacted by the end of the
reporting period.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group
intends to settle its current tax assets and liabilities on a net basis.
Current and deferred tax are recognised as an expense or income in profit or loss, except when they relate to items
credited or debited outside profit or loss (either in other comprehensive income or directly in equity), in which
case the tax is also recognised outside profit or loss (either in other comprehensive income or directly in equity,
respectively), or where they arise from the initial accounting for a business combination.
FOREIGN CURRENCY TRANSACTIONS - The financial statements of each entity are measured and presented
in the currency of the primary economic environment in which the entity operates (its functional currency). The
consolidated financial statements of the Group and the statement of financial position and statement of changes in
equity of the Company are presented in Singapore dollars, which is the functional currency of the Company, and the
presentation currency for the consolidated financial statements.
In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s
functional currency are recorded at the rates of exchange prevailing on the date of the transaction. At each end of
the reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at the
end of the reporting period. Non-monetary items carried at fair value that are denominated in foreign currencies
are retranslated at the rates prevailing on the date when the fair value was determined. Non-monetary items that are
measured in terms of historical cost in a foreign currency are not retranslated.
62
31 DECEMBER 2009
Exchange differences arising on the settlement of monetary items, and on retranslation of monetary items are included
in profit or loss for the period. Exchange differences arising on the retranslation of non-monetary items carried at fair
value are included in profit or loss for the period except for differences arising on the retranslation of non-monetary
items in respect of which gains and losses are recognised in other comprehensive income. For such non-monetary
items, any exchange component of that gain or loss is also recognised in other comprehensive income.
In order to hedge its exposure to certain foreign exchange risks, the Company enters into forward contracts and
options (please see above for details of the Group’s accounting policies in respect of such hedging instruments).
3 KEY SOURCES OF ESTIMATION UNCERTAINTY
Critical judgements in applying the Group’s accounting policies
In the application of the Group’s accounting policies, which are described in Note 2, the Group is required to make
judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent
from other sources. The estimates and associated assumptions are based on historical experience and other factors that
are considered to be relevant. Actual results may differ from these estimates. The Group is of the opinion that any
instances of applications of judgements are not expected to have a significant effect on the amounts recognised in the
financial statements (apart from those involving estimations, which are dealt with below).
Key sources of estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the end of the reporting
period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities
within the next financial year, are discussed below:
Provisions
Provisions are recognised when the Group has a present obligation as a result of a past event and it is probable that
the Group will be required to settle that obligation.
a) Accident claims
Claims for property damage and personal injury are provided in the financial statements based on the claims
outstanding as of the end of the financial year and estimated amounts payable. The past claims history and
payment trend are used as a basis to estimate the amounts in which the Company will have to pay to third
parties for such claims. As at 31 December 2009, the provision for claims is $12,291,000 (2008 : $10,229,000)
(Note 15).
b) Insurance premium
The Company has undertaken personal injury insurance to cover its liability for injury to third party where
claims are in excess of $15,000. The insurance premium payable was based on an agreed minimum sum payable
in advance and an additional amount payable should the incurred claims per bus exceed the minimum amount
as stipulated in the insurance policy for that year. With effect from 1 April 2008, the Company has undertaken
personal injury insurance with a fixed annual premium per bus. The Company had in the previous financial years
incurred additional premium payable as the insurance claims per bus had exceeded the minimum stipulated
amount. Accordingly, based on the past history of incurred claims per bus for each of the policy year, an estimate
of the liability is made. As at 31 December 2009, the provision for insurance premium for the period from 1999
to 2008 included in insurance premiums payable and provision for accident claims (Note 15) is $23,030,000
(2008 : $23,194,000).
63
31 DECEMBER 2009
3 KEY SOURCES OF ESTIMATION UNCERTAINTY (Cont’d)
c) Retirement benefits
Retirement benefits subject to a maximum of $3,000 is payable to a retiring employee on or after attaining the
age of 62 years and on completion of at least five years of service. Provision is made based on the number of years
of service rendered by qualifying employees and discounted to present value using the market yield of Singapore
Government Bonds at end of the reporting period of 0.49% to 3.36% (2008 : 0.80% to 2.46%) per annum
and after taking into account an estimated attrition rate. The estimated attrition rate used is based on the best
estimate of the Company’s attrition rate, based on past experience. As at 31 December 2009, the provision for
retirement benefits is $9,734,000 (2008 : $9,505,000) (Note 17).
d) Long service awards
Staff with more than 15 years of service is entitled to long service awards of $250 for 15 years of services, $350
for 20 years, $500 for 25 years and $700 for 30 years. Provision is made based on the number of years of
service rendered by qualifying employees and discounted to present value using the market yield of Singapore
Government Bonds at end of the reporting period of 0.49% to 3.36% (2008 : 0.80% to 2.46%) per annum and
after taking into account an estimated attrition rate. The estimated attrition rate used is based on the best estimate
of the Company’s attrition rate, based on past experience. As at 31 December 2009, the provision for long service
awards is $2,775,000 (2008 : $2,732,000) (Note 17).
Unquoted investments
The fair values of unquoted debt securities are obtained from market makers (dealers) of the debt securities. The prices
represent the dealers’ price of similar debt securities at the last market day of the financial year. As at 31 December
2009, there are no unquoted investments (2008 : $32,004,000).
4 HOLDING COMPANY, RELATED COMPANY AND RELATED PARTY TRANSACTIONS
The Company’s ultimate holding company is ComfortDelGro Corporation Limited, incorporated in Singapore. In
2008, the Company was a subsidiary of DelGro Corporation Limited and the Company’s ultimate holding company
was ComfortDelGro Corporation Limited, both incorporated in Singapore. With effect from November 2009,
ComfortDelGro Corporation Limited acquired DelGro Corporation Limited’s shares in the Company. Consequently,
ComfortDelGro Corporation Limited became the Company’s immediate and ultimate holding company.
Related companies in these financial statements refer to members of the ultimate holding company’s group
of companies.
Some of the Group’s transactions and arrangements are with related parties and other members of the ultimate holding
company’s group of companies and the effects of these on the basis determined between the parties are reflected in
these financial statements.
Related parties are entities with common direct or indirect shareholders and/or directors. Parties are considered to be
related if one party has the ability to control the other party or exercise significant influence over the other party in
making financial and operating decisions.
64
31 DECEMBER 2009
4 HOLDING COMPANY, RELATED COMPANY AND RELATED PARTY TRANSACTIONS (Cont’d)
Significant intercompany and related party transactions during the financial year, other than those disclosed elsewhere
in the notes to the financial statements are as follows:
The Group
2009
2008
$’000
$’000
Purchases of inventories from a related company
39,317
36,984
Rental expense from:
Immediate holding company
1,629
2,878
Ultimate holding company
198
Related companies
428
111
Purchase of goods and services from:
2,927
2,723
Related companies
870
1,376
Associate of the ultimate holding company
339
1,162
Firm of which a director is a member
26
35
Sales of goods and services to:
(75)
(80)
Related companies
(2,165)
(2,163)
Rental income from related companies
(184)
(202)
Transfer of vehicles, premises and equipment to ultimate holding company
(1)
The amounts outstanding are unsecured, interest-free and are repayable on demand, unless otherwise stated.
No guarantees have been given or received.
No expense has been recognised in the financial year for bad and doubtful debts in respect of the amounts owed by
related companies.
5 SHORT-TERM DEPOSITS AND BANK BALANCES
Cash and bank balances Time deposits Total
65
The Group and
The Company
2009
2008
$’000
$’000
4,157
1,900
6,057
4,045
28,808
32,853
31 DECEMBER 2009
6 HELD-FOR-TRADING INVESTMENTS
Unquoted investments, at fair value:
Notes in corporations
-
32,004
The basis of which the fair values of unquoted investments are determined is stated in Note 3. Additional information
is presented in Note 29(d).
7 AVAILABLE-FOR-SALE INVESTMENTS
Quoted investments, at fair value:
Bonds in corporations
Analysed as:
Current
Non-current
The Group and
The Company
2009
2008
$’000
$’000
The Group and
The Company
2009
2008
$’000
$’000
15,320
19,498
-
15,320
15,320
5,018
14,480
19,498
Quoted investments’ fair values are based on closing market prices on the last market day of the financial year.
8 TRADE RECEIVABLES
Associate (Note 11)
Related companies (Note 4)
Outside parties
Allowance for doubtful trade receivables from outside parties
Net
66
The Group and
The Company
2009
2008
$’000
$’000
3,158
5
5,334
8,497
(16)
8,481
2,334
5
4,643
6,982
(18)
6,964
31 DECEMBER 2009
8 TRADE RECEIVABLES (Cont’d)
The amounts outstanding are interest-free and the average credit period is 7 to 30 days (2008 : 7 to 45 days).
Allowance has been made for estimated irrecoverable amounts which has been determined by reference to past
default experience.
In determining the recoverability of a trade receivable, the Group considers any change in the credit quality of the
trade receivables from the date credit was initially granted up to the reporting date. The concentration of credit risk is
limited due to the customer base being large and unrelated. Accordingly, there is no further credit provision required
in excess of the allowance for doubtful trade receivables.
9 OTHER RECEIVABLES AND PREPAYMENTS
The Group
2009
2008
$’000
$’000
The Company
2009
2008
$’000
$’000
Receivables from:
Ultimate holding company (Note 4)
20 5
20 5
Immediate holding company (Note 4)
-
101
-
101
Subsidiary (Note 10)
-
-
16 16
Associate (Note 11)
276
209
276
209
480
430
480
430
Total
776
745
792
761
Allowance for doubtful receivables from subsidiary
-
-
(16)
(16)
Net
776
745
776
745
Downpayments for the purchase of vehicles,
premises and equipment
22,126
19,391
22,126
19,391
Prepayments
3,997
6,192
3,997
6,192
Interest receivable
248
788
248
788
Staff advances
81
106
81
106
Security deposits:
-
732
-
732
Related company (Note 4)
732
-
732
Outside parties
700
586
700
586
Others
3,531
1,968
3,531
1,968
Net
32,191
30,508
32,191
30,508
Allowance for doubtful receivables is based on the assessment of the recoverability of the receivables.
The receivables from associate are interest-free, unsecured and are repayable on demand.
67
31 DECEMBER 2009
10 SUBSIDIARY
The Company has investments in unquoted equity shares representing a 100% (2008 : 100%) equity interest in
Monteria Pte Ltd, incorporated in Singapore. The cost of investment in the subsidiary is $2.00 (2008 : $2.00).
The subsidiary’s role is to assume the rights and obligations under certain leases and related agreements previously
entered into by a related company. The subsidiary is currently inactive and is not audited.
11 ASSOCIATE
Unquoted equity shares, at cost
Add: Share of post-acquisition reserves
Total
The Group
2009
2008
$’000
$’000
The Company
2009
2008
$’000
$’000
535
1,052
1,587
1,280
-
1,280
535
733
1,268
1,280
1,280
a) Details of the associate is as follows:
Country of
incorporation/
Cost of
Group’s
Associate
Principal activity
operations Investment
effective interest
2009
2008
2009
2008
$’000
$’000
%
%
Transit Link Pte Ltd Provide support services
Singapore
1,280
1,280
50
50
to the transport operators
in Singapore
During the financial year, Transit Link Pte Ltd earned a service fee of $13,172,000 (2008 : $12,851,000) from
the Company.
The associate’s financial year end is 31 March and is audited by PricewaterhouseCoopers LLP. For the purpose
of applying the equity method of accounting, the management accounts of the company for the year ended
31 December 2009 have been used.
In accordance to Rule 716 of The Singapore Exchange Securities Trading Limited – Listing Rules, the Audit
Committee and Board of Directors of the Company confirmed that they are satisfied that the appointment of
different auditor for its significant associated company would not compromise the standard and effectiveness of
the audit of the Group.
68
31 DECEMBER 2009
11 ASSOCIATE (Cont’d)
b) Summarised financial information in respect of the Group’s associate is set out below:
2009
$’000
Total assets
21,850
Total liabilities
(18,676)
Net assets
3,174
Group’s share of associate’s net assets
1,587
Revenue
8,695
Profit for the year
638
Group’s share of associate’s profit for the year
319
69
2008
$’000
28,426
(25,890)
2,536
1,268
5,569
607
304
31 DECEMBER 2009
12 VEHICLES, PREMISES AND EQUIPMENT
Leasehold
Leasehold
Buses
land
buildings
$’000
$’000
$’000
The Group and The Company
Cost:
At 1 January 2008
782,526
16,642
55,720
Additions
9,934
-
1,265
Disposals
(77,300)
-
-
Reclassifications
132,341
-
3,013
At 31 December 2008
847,501
16,642
59,998
Additions
8,748
-
2,151
Disposals
(87,586)
-
-
Reclassifications
141,660
-
750
Transfers to ultimate holding company
-
-
-
At 31 December 2009
910,323
16,642
62,899
Accumulated depreciation:
At 1 January 2008
634,358
3,371
24,425
Depreciation
15,866
595
3,573
Disposals
(77,226)
-
-
Reclassifications
(233)
-
-
At 31 December 2008
572,765
3,966
27,998
Depreciation
26,343
594
3,706
Disposals
(87,560)
-
-
Transfers to ultimate holding company
-
-
-
At 31 December 2009
511,548
4,560
31,704
Carrying amount:
At 31 December 2009
398,775
12,082
31,195
At 31 December 2008
274,736
12,676
32,000
70
Computers and
automated
equipment
$’000
Workshop
machinery, tools
Motor
and equipment
vehicles
$’000
$’000
Furniture,
fittings and
equipment
$’000
Capital
projects
in progress
$’000
97,907
16,006
3,977
9,359
12,541
937
1,880
334
340
131,977
(699)
(261)
(208)
(207)
-
372
-
233
-
(135,959)
98,517
17,625
4,336
9,492
8,559
1,640
1,535
354
138
151,104
(875)
(584)
(345)
(696)
-
(41)
-
-
385
(142,754)
(10)
-
-
(3)
-
99,231
18,576
4,345
9,316
16,909
56,241
13,421
3,739
7,636
-
9,560
858
124
939
-
(697)
(261)
(208)
(199)
-
-
-
233
-
-
65,104
14,018
3,888
8,376
-
8,091
1,026
167
556
-
(874)
(575)
(345)
(695)
-
(9)
-
-
(3)
-
72,312
14,469
3,710
8,234
-
26,919
4,107
635
1,082
16,909
33,413
3,607
448
1,116
8,559
71
Total
$’000
994,678
146,667
(78,675)
1,062,670
165,670
(90,086)
(13)
1,138,241
743,191
31,515
(78,591)
696,115
40,483
(90,049)
(12)
646,537
491,704
366,555
31 DECEMBER 2009
12 VEHICLES, PREMISES AND EQUIPMENT (Cont’d)
Note:
a) During the financial year, government grants amounting to $546,000 (2008 : $586,000) has been received from
the government authorities to purchase certain assets. The grants received/receivable have been offset against the
cost of the assets acquired to derive the carrying amount in accordance with the Group’s accounting policy.
b) Included under Buses with total costs of $105,516,000 (2008 : $105,516,000) and carrying amount of
$17,134,000 (2008 : $19,270,000) which are the subject of two (2008 : two) cross border leasing transactions.
The Group’s and the Company’s legal obligations under these transactions have been legally defeased (See
Note 27).
c) Details of leasehold land and buildings of the Group and the Company are as follows:
Location
Approximate land area Tenure
Usage
No. 28
26,670 sq m
Soon Lee Road
Singapore
30 years from
1 April 2000
Bus depot
No. 550
52,187 sq m
Bukit Batok Street 23
Singapore
30 years from
1 January 1983
Bus depot
No. 4
74,236 sq m
Defu Ave 1
Singapore
30 years from
1 January 1983
Bus depot
No. 1470
62,220 sq m
Under Temporary
Bedok North Ave 4Occupation License
Singapore
Bus depot
No. 2A
17,939 sq m
Under Temporary
Ayer Rajah CrescentOccupation License
Singapore
Bus park
No. 15
63,953 sq m
Ang Mo Kio Street 63
Singapore
Bus depot
19 years from
1 March 1994
72
31 DECEMBER 2009
13 TRADE AND OTHER PAYABLES
Payables to:
Ultimate holding company (Note 4)
Outside parties
Accruals
Deferred income
Total
The Group and
The Company
2009
2008
$’000
$’000
768 -
4,961
39,970
87,111
2,462
135,272
334
244
6,366
33,699
60,443
1,114
102,200
Trade payables and accruals principally comprise amounts outstanding for trade purchases and ongoing costs.
The amounts outstanding are interest-free and the average credit period is 30 days (2008 : 30 days).
Additional information is presented in Note 29(d).
14 DEPOSITS RECEIVED
Deposits received Less: Due within 12 months
Due after 12 months
The Group and
The Company
2009
2008
$’000
$’000
3,946
(1,549)
2,397
3,431
(1,668)
1,763
Deposits received from tenants in respect of leases of stalls and shoplots, are repayable on demand upon termination
of the lease agreements. Deposits that are not expected to be repaid within the next twelve months after the end of
the reporting period estimated based on past trend of termination of lease agreements are presented as a non-current
liability. The carrying amount of the deposits approximates their fair value.
73
31 DECEMBER 2009
15 INSURANCE PREMIUMS PAYABLE AND PROVISION FOR ACCIDENT CLAIMS
At beginning of year
Charge to profit and loss
Payments
At end of year
The balance comprises provision for:
Insurance premiums
Accident claims
16 DEFERRED TAX LIABILITIES
Charge to profit and loss (Note 24)
Over provision in prior years
Changes in tax rates
At end of year
The balance comprises the tax effects of:
Excess of carrying amount over tax written down value
Provision for fuel equalisation
Other items
Net
74
The Group and
The Company
2009
2008
$’000
$’000
33,423
5,870
(3,972)
35,321
33,068
4,996
(4,641)
33,423
23,030
12,291
35,321
23,194
10,229
33,423
The Group and
The Company
2009
2008
$’000
$’000
23,010
9,002
-
(1,240)
30,772
17,271
9,405
(3,666)
23,010
43,993
(5,793)
(7,428)
30,772
36,565
(6,133)
(7,422)
23,010
31 DECEMBER 2009
17 PROVISION FOR SERVICE BENEFITS AND LONG SERVICE AWARDS
Charge to profit and loss
Payments
At end of year
The balance comprises provision for:
Retirement benefits
Long service awards
The Group and
The Company
2009
2008
$’000
$’000
12,237
778
(506)
12,509
10,556
2,045
(364)
12,237
9,734
2,775
12,509
9,505
2,732
12,237
18 SHARE CAPITAL
The Group and The Company
2009
2008
2009
2008
Number (’000) $’000
$’000
of ordinary shares
Issued and paid up:
307,721
307,224
92,310
91,324
-
497
-
986
At end of year
307,721
307,721
92,310
92,310
Details of the outstanding share options of the Company as at the end of the financial year are set out in Note 21(b).
The Company has one class of ordinary shares which carry no right to fixed income.
75
31 DECEMBER 2009
19 CAPITAL RESERVES
Share option reserve:
Transfer to share capital on exercise of share options (Note 18)
Transfer to accumulated profits
At end of year
Revaluation reserve:
Gain (Loss) on available-for-sale investments
At end of year
Net
20 REVENUE
Revenue comprises the following amounts:
Transport services:
Bus
Rail
Advertisements
Rental
Total
The Group and
The Company
2009
2008
$’000
$’000
765
319
-
(13)
1,071
531
291
(23)
(34)
765
(502)
822
320
423
(925)
(502)
1,391
263
The Group
2009
2008
$’000
$’000
545,995
109,182
27,321
14,585
697,083
581,084
106,563
30,916
12,767
731,330
21 STAFF COSTS
a) Included in staff costs are:
i) Directors’ remuneration
The Group
Total
Remuneration band
Salary
Bonus
Others compensation
%
%
%
%
2009
($500,000 - $749,999)
Gan Juay Kiat
45
49
6
100
There was no executive Director in 2008.
The remuneration of all the other non-executive Directors is below $250,000 and comprised entirely of
Directors’ fees (Note 22).
76
31 DECEMBER 2009
21 STAFF COSTS (Cont’d)
ii) Key executives’ remuneration
The Group
Total
Remuneration band
Salary
Bonus
Others compensation
%
%
%
%
2009
($250,000 - $499,999)
No. of executives : 3
61
31
(below $250,000)
66
27
2008
($250,000 - $499,999)
63
29
8
100
7
100
8
100
iii) The remuneration of Directors and key executives is determined by the Remuneration Committee having
regard to the performance of individuals and the Group. The total remuneration for the Directors and key
executives comprising of short term benefits amounted to $1,842,113 (2008 : $1,938,000).
iv) Cost of contribution to Central Provident Fund
The Group
2009
2008
$’000
$’000
23,112
23,877
b) Share-based payments
Equity-settled share option scheme
The Company has a share option scheme for employees of the Company and its subsidiary of the rank of Executive
and above, and certain categories of persons who are not employees but who work closely with the Company
and its subsidiary. The scheme is administered by the Remuneration Committee. Options are exercisable at
a subscription price determined with reference to the market price of the shares at the time of grant of the
options. The vesting period is one year. If the options remain unexercised after a period of 10 years (five years
for non-executive Directors) from the date of the grant, the options expire. Options granted will lapse when the
option holder ceases to be a full-time employee or Director of the Company, subject to certain exceptions at the
discretion of the Remuneration Committee.
77
31 DECEMBER 2009
21 STAFF COSTS (Cont’d)
Details of the share options outstanding during the year are as follows:
The Group
2009 2008
Weighted Weighted
average
average
Number of
exercise
Number of
exercise
share options
price share options
price
$
$
Outstanding at the beginning of the year
Granted during the year
Cancelled/Lapsed during the year
Exercised during the year
Outstanding at the end of the year
9,376,250
2,762,500
(261,250)
-
11,877,500
2.49
1.58
2.35
-
2.28
7,592,250
2,780,000
(499,500)
(496,500)
9,376,250
2.58
2.18
2.68
1.94
2.49
Exercisable at the end of the year
9,167,500
2.49
6,686,250
2.61
No options were exercised during the year. The weighted average share price at the date of exercise for share
options exercised for 2008 was $2.53. The options outstanding at the end of the year have a weighted average
remaining contractual life of 6.5 years (2008 : 7.0 years). For further details on the exercise prices of the options
outstanding at the end of the year, please refer to the Report of the Directors.
During the financial year, options were granted on 25 June 2009 (2008 : 25 June 2008). The estimated fair value
of the options granted on that date was $0.14 (2008 : $0.10).
These fair values for share options granted during the year were calculated using the Black-Scholes pricing model.
The inputs into the model were as follows:
2009
2008
Weighted average share price
$1.60
$2.20
Weighted average exercise price
$1.58
$2.18
Expected volatility
18.89%
17.62%
Expected life (years)
2.80
2.80
Risk free rate
2.06%
1.55%
Expected dividend yield
5.06%
7.84%
Expected volatility was determined by calculating the historical volatility of the Company’s share price over
the previous 5 years (2008 : 3 years). The expected life used in the model has been adjusted, based on the best
estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations.
The Group recognised total expenses of $319,000 (2008 : $291,000) related to equity-settled share-based
payment transactions (included in staff costs) during the year.
78
31 DECEMBER 2009
22 OPERATING PROFIT
In addition to the charges and credits disclosed elsewhere in the notes to the financial statements, this item includes
the following charges (credits):
The Group
2009
2008
$’000
$’000
Directors’ fees
322
313
Cost of inventories recognised in repairs and maintenance expense
72,313
70,739
Foreign currency exchange adjustment loss, arising from operations
284
194
Foreign currency exchange adjustment (gain) loss, arising from investments
(58)
37
Net gain on disposal of vehicles and equipment
(1,828)
(1,687)
Insurance premiums payable and provision for accident claims
5,870
5,510
Provision for service benefits and long service awards
778
2,045
Audit fees:
Paid to auditors of the Company
123
123
Non-audit fees:
Paid to auditors of the Company
30
27
Professional fee paid to a firm of which a director is a member
26
35
23 NET INCOME FROM INVESTMENTS
Interest income:
Bonds
Time deposits
Notes
Fair value gain on interest rate swaps
Interest rate swaps loss
Other investment income:
Net (loss) gain on disposal of held-for-trading investments
Net gain on fair value changes of held-for-trading investments
Total
24 TAXATION
Current taxation
Deferred tax (Note 16)
Under-provision of current tax in prior years
79
The Group
2009
2008
$’000
$’000
680
79
53
-
-
900
419
1,405
25
(100)
(5)
1
808
168
79
2,896
The Group
2009
2008
$’000
$’000
152
7,762
804
8,718
296
9,405
9,701
31 DECEMBER 2009
24 TAXATION (Cont’d)
The taxation charge varied from the amount of taxation charge determined by applying the Singapore income tax rate
of 17% (2008 : 18%) to profit before taxation as a result of the following differences:
The Group
2009
2008
$’000
$’000
63,330
50,281
Less: Share of profit in associate
(319)
(304)
63,011
49,977
Taxation charge at statutory rate 10,712
8,996
Non-allowable items
(1,481)
917
Effect of changes in tax rate
(1,240)
Tax-exempt income
(26)
(27)
Under-provision in prior years
804
Other items
(51)
(185)
8,718
9,701
25 EARNINGS PER SHARE
Earnings per share is calculated by dividing the Group’s net profit attributable to shareholders of the Company for the
year by the weighted average number of ordinary shares in issue during the financial year as follows:
Profit attributable to shareholders of the Company ($’000)
Weighted average number of ordinary shares in issue (’000)
Basic earnings per share (in cents)
2009
2008
54,612
40,580
307,721
307,575
17.75
13.19
For the diluted earnings per share, the weighted average number of ordinary shares in issue is adjusted to assume
conversion of all dilutive potential ordinary shares which are the share options granted to employees and Directors. A
calculation is done to determine the number of shares that could have been acquired at market price (determined as
the average share price of the Company’s shares for the financial year) based on the monetary value of the subscription
rights attached to outstanding share options. This calculation serves to determine the ‘unpurchased’ shares to be added
to the ordinary shares outstanding for the purpose of computing the dilution.
Profit attributable to shareholders of the Company ($’000)
Weighted average number of ordinary shares in issue (’000)
Adjustments for share options (’000)
Weighted average number of ordinary shares for the purpose
of diluted earnings per share (’000)
Diluted earnings per share (in cents)
80
2009
2008
54,612
40,580
307,721
133
307,575
182
307,854
307,757
17.74
13.19
31 DECEMBER 2009
26 BUSINESS SEGMENT INFORMATION
The Group operates principally in Singapore.
Information reported to the Group’s chief operating decision maker for purposes of resource allocation and assessment
of segment performance are based on the following:
a) Bus
: Income is generated through bus fare collections.
b) Rail
: Income is generated through rail fare collections.
c) Advertisements : Income is generated through advertisements on the buses, trains and at Mass Rapid Transit
(“MRT”) and Light Rail Transit (“LRT”) stations.
d) Rental
: Income is generated through rental collections from commercial and shop space at bus
interchanges and rail stations.
Segment revenue and expense: Segment revenue and expense are the operating revenue and expense reported in the
Group’s profit and loss that are directly attributable to a segment and the relevant portion of such revenue and expense
that can be allocated on a reasonable basis to a segment.
Segment assets and liabilities: Segment assets include all operating assets used by a segment and consist principally
of operating receivables, inventories and vehicles, premises and equipment, net of allowances and provisions. Capital
additions include the total cost incurred to acquire vehicles, premises and equipment directly attributable to the
segment. Segment liabilities include all operating liabilities and consist principally of accounts payable and accruals.
Associate: Income from associate is not allocated as it is not specifically attributable to business segments, and
correspondingly the investment in associate is not included as segment assets of the business segments.
2009
REVENUE
Bus
$’000
Rail
$’000
Advertisements
$’000
Rental
$’000
Total
$’000
545,995
109,182
27,321
14,585
697,083
RESULTS
Segment results
22,367
13,356
16,095
10,385
Taxation
Profit after taxation
81
62,203
808
319
63,330
(8,718)
54,612
31 DECEMBER 2009
26 BUSINESS SEGMENT INFORMATION (Cont’d)
OTHER INFORMATION
Additions of vehicles, premises and equipment
Bus
$’000
Rail
$’000
Advertisements
$’000
Rental
$’000
Total
$’000
161,999
37,955
795
581
39
363
2,837
1,584
165,670
40,483
STATEMENT OF FINANCIAL POSITION
ASSETS
Segment assets
529,412
23,513
5,552
6,025
Investment in associate
Unallocated corporate assets
Consolidated total assets
564,502
1,587
19,849
585,938
LIABILITIES
Segment liabilities
224,890
23,656
4,757
7,053
Unallocated corporate liabilities
Consolidated total liabilities
260,356
37,481
297,837
2008
REVENUE
581,084
106,563
30,916
12,767
RESULTS
Segment results
8,491
10,420
19,277
8,893
Taxation
Profit after taxation
OTHER INFORMATION
Additions of vehicles, premises and equipment
143,517
29,463
48
346
47,081
2,896
304
50,281
(9,701)
40,580
2,273
1,091
146,667
31,515
STATEMENT OF FINANCIAL POSITION
ASSETS
Segment assets
400,730
20,135
5,155
6,201
Investment in associate
Unallocated corporate assets
Consolidated total assets
432,221
1,268
82,973
516,462
LIABILITIES
Segment liabilities
198,543
20,664
3,823
4,876
Unallocated corporate liabilities
Consolidated total liabilities
227,906
31,308
259,214
82
829
615
731,330
31 DECEMBER 2009
27 CONTINGENT LIABILITIES - UNSECURED
As at 31 December 2009, the Group and the Company have contingent liabilities totalling $3,123,000 (2008 :
$4,489,000) in respect of cross border leasing transactions, under which they have legally defeased all their liabilities
under the leases except for the risk of having to pay off this amount to counterparties should they cause the collapse
of these leasing arrangements. The Group and the Company are not aware of any conditions that will cause them to
initiate the collapse of these leasing arrangements.
28 COMMITMENTS
As at 31 December 2009, the Group and the Company have the following commitments:
a) Capital commitments contracted for but not provided for in the financial statements:
The Group and
The Company
2009
2008
$’000
$’000
Purchase of vehicles, premises and equipment
117,248
124,386
b) Operating lease commitments:
The Group and the Company as lessee
Minimum lease payment under operating leases included in the profit or loss
(net of rebates)
The Group and
The Company
2009
2008
$’000
$’000
5,956
6,593
At end of the reporting period, commitments in respect of the non-cancellable operating leases which fall due are
as follows:
The Group and
The Company
2009
2008
$’000
$’000
Within one year
6,764
5,228
In the second to fifth year inclusive
13,034
13,441
Total
19,798
18,669
Operating lease payments represent rentals payable by the Group and the Company for office premises and bus
depots. Leases are negotiated for periods up to 30 years and rental is fixed for an average of one year.
83
31 DECEMBER 2009
28 COMMITMENTS (Cont’d)
The Group and the Company as lessor
The Group and the Company rent out part of their bus spaces and floor areas at bus depots and train stations
under operating leases. Property rental and licence fee income earned under non-cancellable leases during the
year was $11,785,000 (2008 : $10,719,000). The properties are managed and maintained by the Company.
At end of the reporting period, the Group and the Company contracted with tenants for the following future
minimum lease payments:
The Group and
The Company
2009
2008
$’000
$’000
Within one year
8,966
9,156
In the second to fifth year inclusive
6,008
6,675
Total
14,974
15,831
29 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT
(a) Financial risk, management policies and objectives
The main areas of financial risk faced by the Group are foreign currency exchange rate risk, interest rate risk, credit
risk, liquidity risk and fuel price risk. The Group recognises that management of financial risk is an important
aspect in its drive towards creating shareholders’ value. It is the Group’s policy not to participate in speculative
financial instruments. The Group oversees financial risk management and regularly reviews its policy governing
risk management practices.
There has been no change to the Group’s exposure to these financial risks or the manner in which it manages and
measures the risk.
Foreign currency exchange rate risk management
The Group is exposed to currency risk as a result of its purchases of buses, spare parts, fuel and any other
purchases where the currency denomination differs from its functional currency (Singapore Dollar). Its exposures
include United States Dollar (“USD”), Swedish Kroner (“SEK”), Euro (“EUR”), Japanese Yen (“JPY”), Malaysian
Ringgit (“MYR”) and Sterling Pound (“GBP”). The Group manages its foreign currency exposure through active
currency management using hedging instruments such as forwards or options where necessary.
Foreign currency sensitivity
Based on sensitivity analysis performed, the exposure to changes in foreign exchange rates is minimal and hence
the resulting impact on profit or loss and equity of the Group is insignificant.
84
31 DECEMBER 2009
29 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (Cont’d)
Interest rate risk management
The Group’s primary interest rate risk relates to investments in fixed income securities and deposits. The Group
uses hedging instruments such as interest rate swaps and caps, where necessary, to achieve the desired interest rate
profile in its effort to manage interest rate risk.
Summary quantitative data of the Group’s interest-bearing financial instruments are disclosed in Section (d) of
this note.
Interest rate sensitivity
Based on sensitivity analysis performed at end of the reporting period, the exposure to changes in interest rates is
minimal and hence the resulting impact on the profit or other comprehensive income of the Group is insignificant.
Credit risk management
The Group has minimal credit risk arising from its public transport operations. Majority of its commuters use the
contactless smart card where cash is collected upfront. Credit risk arises mainly from advertisement and rental
revenue and is controlled via upfront deposits or strict credit terms and regular monitoring of advertisers’ and
tenants’ financial standing. The Group also enters into treasury transactions only with creditworthy institutions
and seeks to invest in quality investee companies. Almost all of its fixed income investments are above investment
grade as assigned by international credit-rating agencies. There is no significant concentration of credit risk.
In determining the recoverability of a receivable, the Group considers any change in the credit quality of the
receivable from the date credit was initially granted up to the reporting date. The carrying value of financial assets
represents the maximum credit risk exposure of the Group.
Liquidity risk management
The Group regularly reviews its liquidity position comprising free cash flows from its operations and credit lines
from banks and have secured adequate funding with the best possible rates.
Fuel price risk management
Fuel, comprising diesel and electricity, is part of the operating cost of the Group. The Group seeks to hedge the
price risk associated with its fuel needs and uses hedging instruments, where necessary, to achieve the desired
hedge outcome.
Based on sensitivity analysis performed and taking into account the fuel hedges in place, as at end of the reporting
period, every one percentage point change in the rates of diesel and electricity using the closing rates as at end
of the reporting period as a basis will impact the Group’s annual fuel and electricity costs by $1.06m (2008:
$0.47m). The sensitivity analysis assumes that consumption is held constant at the same level as in 2009.
Fair values of financial assets and financial liabilities
The carrying amounts of cash and cash equivalents, trade and other current receivables and payables, and other
liabilities approximate the respective fair values due to the relatively short-term maturity of these financial
instruments.
The fair values of other classes of financial assets and liabilities are disclosed in the respective notes to the financial
statements.
85
31 DECEMBER 2009
(b) Hedging instruments
At end of the reporting period, the total notional amount of outstanding hedging instruments to which the
Group and the Company are committed are as follows:
The Group and
The Company
2009
2008
$’000
$’000
Foreign currency forward contract
11,802
2,216
Fuel hedges
10,841
44,380
The Group and the Company use forward contracts and options to manage the exposure to foreign exchange
risks. These arrangements are designed to address foreign exchange risk on future purchases of goods and are
accounted for as fair value hedges. As at 31 December 2009, the fair value of the Group’s foreign exchange
hedging instruments comprising $187,000 of assets (2008 : $52,000 liabilities) is matched by an equivalent fair
value adjustment on the hedged item.
The Group and the Company use fuel hedges to hedge against fuel price risks. These arrangements are designed
to address fuel price exposure. The fuel hedges are accounted for as fair value hedges. As at 31 December 2009,
the fair value of the Group and the Company’s fuel hedging instruments comprising $1,560,000 of assets
(2008 : $13,270,000 of liabilities) is matched by an equivalent fair value adjustment on the hedged item.
These amounts are based on market prices for equivalent instruments at the end of the reporting period.
(c) Capital risk management policies and objectives
The Group’s capital management objectives are to safeguard its ability to continue as a going concern and to
maximise shareholder value. The gross and net gearing of the Group and its implication on weighted average
cost of capital are monitored in deciding the optimal capital structure. These objectives determine the Group’s
decisions on the amount of dividends to be paid to shareholders and the sources of capital to be raised, be it
equity or debt.
86
31 DECEMBER 2009
(d) The table below summarises the Group’s and the Company’s assets, liabilities and financial instruments, categorised
by the earlier of contractual repricing or maturity dates and depicts the Group’s and the Company’s exposure to
interest rate risk at year end.
Effective
Within
Within
Beyond
interest rate
1 year 2 to 5 years
5 years
Total
at year end
$’000
$’000
$’000
$’000
%
The Group and the Company
2009
Financial Assets
Cash and bank balances:
In functional currency:
In non-functional currencies:
EUR
GBP
Others Total
Time deposits:
In functional currency
3,909
-
-
3,909
-
103
53
92
4,157
-
-
-
-
-
-
-
-
103
53
92
4,157
0.17
0.14
-
1,900
-
-
1,900
0.12
Short-term deposits and cash and bank balances comprise bank deposits with an original maturity of one month
or less. The carrying amounts of these financial assets approximate their fair values.
Within
Within
Beyond
1 year 2 to 5 years
5 years
Total
$’000
$’000
$’000
$’000
Available-for-sale investments:
Bonds in functional currency
-
87
9,957
5,363
15,320
Effective
interest rate
at year end
%
3.83 – 4.84
31 DECEMBER 2009
Within
Within
Beyond
1 year 2 to 5 years
5 years
Total
$’000
$’000
$’000
$’000
2008
Financial Assets
Cash and bank balances:
In functional currency:
In non-functional currencies:
USD
EUR
GBP
JPY
Others
Total
Time deposits:
In functional currency
3,605
-
-
3,605
-
162
108
73
57
40 4,045
-
-
-
-
-
-
-
-
-
-
-
-
162
108
73
57
40
4,045
0.98
2.80
3.80
-
28,808
-
-
28,808
0.36 – 0.88
Short-term deposits and cash and bank balances comprise bank deposits with an original maturity of three months
or less. The carrying amounts of these financial assets approximate their fair values. The average remaining tenure
for short-term deposits for 2008 is 0.49 months.
Within
Within
Beyond
1 year 2 to 5 years
5 years
Total
$’000
$’000
$’000
$’000
Held-for-trading investments:
Notes in functional currency
Effective
interest rate
at year end
%
Available-for-sale investments:
Bonds in functional currency
Effective
interest rate
at year end
%
32,004
-
-
32,004
1.68 – 1.89
5,018
-
14,480
19,498
2.97 – 4.84
88
31 DECEMBER 2009
30 DIVIDENDS
a) During the financial year, the Company paid dividends as follows:
Tax-exempt one-tier final dividend in respect of the previous financial year:
– 3.60 cents (2008 : 3.25 cents) per ordinary share Tax-exempt one-tier interim dividend in respect of the current financial year:
– 4.50 cents (2008 : 3.00 cents) per ordinary share
Total
2009
$’000
2008
$’000
11,078
10,000
13,847
24,925
9,232
19,232
b) Subsequent to the statement of financial position, the Directors of the Company recommend that a tax-exempt
one-tier final dividend of 4.30 cents per ordinary share of the Company totalling $13,232,000 be paid for the
financial year ended 31 December 2009.
The dividends are subject to approval by shareholders at the forthcoming Annual General Meeting of the
Company and hence the proposed dividends have not been accrued as a liability for the current financial year.
31 LICENCE CONDITION FOR RAIL SERVICES
A licence condition (“LC”) dated 15 January 2003 was issued by Land Transport Authority (“LTA”) to the
Company under which the Company is licensed to operate the North-East MRT System, Punggol LRT System and
Sengkang LRT System (collectively referred to as the “Licensed Systems”).
The LC sets out the conditions governing the operation of the Licensed Systems and includes, among others,
the following:
a) The licence is for an initial period of 30 years commencing 15 January 2003. The Company may apply to LTA to
renew the licence for a further 30 years or any other period and upon terms and conditions as LTA may impose.
b) An annual licence fee computed based on 0.5% of the total annual fare and non-fare revenue, net of goods
and services tax, is payable to LTA for the first 10 years. LTA may retain or modify the basis for the purpose of
calculating the licence fee thereafter.
c) The Company and LTA shall jointly review the viability on the fifth anniversary of the date of the LC or such
other period as may be agreed in writing between the Company and LTA. In this review, LTA shall determine
the dates and time of the Company’s purchase of the operating assets of the Licensed Systems and the amount is
based on the net book value as recorded in the latest audited accounts of LTA. As at the date of this report, the
Company and LTA have not commenced the review.
d) The Company may apply in writing to LTA for a grant to replace any eligible operating assets computed based
on the difference between the purchase cost of the new assets and the purchase cost of the operating assets to
be replaced.
The main categories of eligible operating assets are trains, maintenance vehicles, power supply equipment,
supervisory control system, escalators and lifts, platform screen doors, environmental control system, tunnel
ventilation system, electrical service and fire protection system, signalling system, communication system,
automatic fare collection system, depot workshop equipment, access management system and maintenance
management system.
89
SHARE PRICE MOVEMENT CHART
SBS TRANSIT’S SHARE PRICE MOVEMENT AND VOLUME TURNOVER
1.90
1.85
1.75
1.70
Share price ($)
1.80
1.65
1.60
0.20
0.10
Volume (mil)
1.55
0m
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
2009
Source: Bloomberg Finance L.P.
COMPARISON OF PERFORMANCE OF SBS TRANSIT’S SHARE PRICE
AND THE STRAITS TIMES INDEX (STI)
80
60
40
20
SBS TRANSIT
0
-20
JAN
FEB
MAR
APR
MAY
JUN
JUL
2009
Source: Bloomberg Finance L.P.
90
AUG
SEP
OCT
NOV
DEC
Percentage
STI
SHAREHOLDING STATISTICS
AS AT 2 MARCH 2010
No. of shares issued : 307,720,516
Class of shares
:Ordinary shares with equal voting rights
Voting rights
:One vote per ordinary share
No. of
Size of Shareholdings Shareholders
%
No. of
Shares
%
9.61
88.01
2.35
0.03
100.00
652,200
30,378,544
19,201,846
257,487,926
307,720,516
0.21
9.87
6.24
83.68
100.00
Top Twenty Shareholders
No. of
Shares
%
ComfortDelGro Corporation Limited Citibank Nominees Singapore Pte Ltd BNP Paribas Securities Services Singapore DBS Nominees Pte Ltd United Overseas Bank Nominees Pte Ltd OCBC Nominees Singapore Pte Ltd Changi Bus Company (Private) Limited Merrill Lynch (S’pore) Pte Ltd Tan Kay Yeong HSBC (Singapore) Nominees Pte Ltd Royal Bank Of Canada (Asia) Ltd DBSN Services Pte Ltd Woon Chio Chong Lim Jun Ying Loh Hon Seng Vincent Tan Kong Eng Tang Wee Loke Chin Harn Tong @ Chee Han Tong Lim Jit Poh Holiday Edward Richard Total
231,673,012 7,925,584 7,408,000 5,342,350 3,476,180 1,662,800 691,548 625,800 467,500 364,300 314,000 276,500 275,000 250,000 222,000 214,800 211,000 210,000 200,000 194,200 262,004,574 75.29
2.58
2.41
1.74
1.13
0.54
0.22
0.20
0.15
0.12
0.10
0.09
0.09
0.08
0.07
0.07
0.07
0.07
0.06
0.06
85.14
No. of Shares
%
231,673,012
75.29
1 – 999
1,000 – 10,000
10,001 – 1,000,000
1,000,001 & Above
Total
2,013
18,432
492
6
20,943
Substantial Shareholder (as shown in the Register of Substantial Shareholders)
ComfortDelGro Corporation Limited
As at 2 March 2010, approximately 24.16% of the issued ordinary shares of SBS Transit Ltd is in the hands of the public.
Rule 723 of the Listing Manual of the Singapore Exchange Securities Trading Limited has been complied with.
91
NOTICE OF ANNUAL GENERAL MEETING
SBS TRANSIT LTD
(Incorporated in the Republic of Singapore)
(Co. Reg. No.: 199206653M)
NOTICE IS HEREBY GIVEN that the Seventeenth Annual General Meeting of the Company will be held at the
Auditorium, ComfortDelGro Headquarters, 205 Braddell Road, Singapore 579701 on Wednesday, 28 April 2010 at
10.00 a.m. for the purpose of transacting the following business:
Ordinary Business:
1. To receive and adopt the Directors’ Report and Audited Financial Statements for the Financial
Year ended 31 December 2009 together with the Auditors’ Report thereon.
(Resolution 1)
2.To declare a tax-exempt one-tier final dividend of 4.30 cents per ordinary share in respect of the
Financial Year ended 31 December 2009.
(Resolution 2)
3. To approve the payment of Directors’ fees of S$322,000 for the Financial Year ended 31
December 2009. (FY2008: S$313,000)
(Resolution 3)
4.To re-elect Mr Kua Hong Pak a Director retiring pursuant to Article 97 of the Company’s
Articles of Association.
(Resolution 4)
5.To re-elect Mr Wee Siew Kim, a Director retiring pursuant to Article 97 of the Company’s
Articles of Association.
(Resolution 5)
6. To re-appoint Mr Lim Jit Poh as a Director pursuant to Section 153(6) of the Companies Act,
Cap. 50 to hold office from the date of this Annual General Meeting until the next Annual
General Meeting.
(Resolution 6)
7. To re-appoint Mr Chin Harn Tong as a Director pursuant to Section 153(6) of the Companies
Act, Cap. 50 to hold office from the date of this Annual General Meeting until the next Annual
General Meeting.
(Resolution 7)
8. To re-appoint Mr Tan Kong Eng as a Director pursuant to Section 153(6) of the Companies
Act, Cap. 50 to hold office from the date of this Annual General Meeting until the next Annual
General Meeting.
(Resolution 8)
9. To re-appoint Messrs Deloitte & Touche LLP as Auditors and authorise the Directors to fix their
remuneration. (Resolution 9)
Special Business:
10.To consider and, if thought fit, to pass the following resolution with or without modifications as
an Ordinary Resolution:
“THAT the Directors of the Company be and are hereby authorised to allot and issue from time
to time such number of shares in the Company as may be required to be issued pursuant to the
exercise of options under the SBS Transit Share Option Scheme, provided that the aggregate
number of shares to be issued pursuant to the SBS Transit Share Option Scheme shall not exceed
15% of the total number of issued shares in the capital of the Company excluding treasury
shares, from time to time.” *
92
(Resolution 10)
NOTICE OF ANNUAL GENERAL MEETING
Books Closure and Dividend Payment Dates
NOTICE IS ALSO HEREBY GIVEN that the Transfer Books and Register of Members of the Company will be closed on
6 May 2010 for the purposes of determining Shareholders’ entitlements to the proposed tax-exempt one-tier final dividend
of 4.30 cents per ordinary share for the Financial Year ended 31 December 2009.
Duly completed and stamped transfers received by the Company’s Share Registrars, B.A.C.S. Private Limited, 63
Cantonment Road, Singapore 089758 up to 5.00 p.m. on 5 May 2010 will be registered before Shareholders’ entitlements
to the final dividend are determined. Shareholders (being depositors) whose securities accounts with The Central Depository
(Pte) Limited are credited with ordinary shares as at 5.00 p.m. on 5 May 2010 will rank for the proposed final dividend.
The final dividend, if approved by the Shareholders at the Seventeenth Annual General Meeting of the Company, will be paid on
17 May 2010.
By Order of the Board
Chan Wan Tak, Wendy/Chew Si Lyn, Cecilia
Joint Company Secretaries
Singapore
30 March 2010
Notes:
1.A member entitled to attend and vote at the Annual General Meeting may appoint one or two proxies to attend and
vote in his stead. A proxy need not be a member of the Company.
2.The instrument appointing a proxy must be lodged at the Company’s registered office at 205 Braddell Road, Singapore
579701 not less than 48 hours before the time appointed for the Annual General Meeting.
Additional Information on Ordinary Business
Mr Wee Siew Kim is the Chairman of the Audit Committee and Mr Chin Harn Tong and Mr Tan Kong Eng are members
of the Audit Committee. They are considered independent Directors of the Company. If re-elected, Mr Wee Siew Kim
will continue as Chairman and Mr Chin Harn Tong and Mr Tan Kong Eng will continue as the members of the Audit
Committee respectively.
*Explanatory Notes on Special Business to be Transacted
Resolution 10 is to authorise the Directors to issue shares upon the exercise of options in accordance with the SBS Transit
Share Option Scheme. This scheme was approved by Shareholders at the Extraordinary General Meeting held on 9 June
2000 and has a maximum duration of 10 years. The aggregate number of shares over which the Committee may grant
options under the scheme for its entire duration is limited to 15% of the issued ordinary shares in the capital of the
Company excluding treasury shares, from time to time. 2009 was the last year for which new options were granted under
this Scheme. The Company is not seeking a renewal of the Scheme.
93
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94
SBS TRANSIT LTD
(Incorporated in the Republic of Singapore)
(Co. Reg. No.: 199206653M)
PROXY FORM
ANNUAL GENERAL MEETING
IMPORTANT
1. For investors who have used their CPF monies to buy SBS Transit Ltd shares, this
Annual Report is forwarded to them at the request of their CPF Approved Nominees
and is sent solely FOR INFORMATION ONLY.
2. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all
intents and purposes if used or purported to be used by them.
3. CPF investors who intend to exercise the voting rights attached to their SBS Transit Ltd
shares purchased using their CPF monies are requested to contact their respective CPF
Approved Nominees.
I/We___________________________________________________________________________________(Name)
of____________________________________________________________________________________(Address)
being a member/members of SBS Transit Ltd hereby appoint:
Name
Address
NRIC/Passport Number
Proportion of Shareholdings(%)
and/or (delete as appropriate)
as my/our proxy/proxies to attend and to vote for me/us on my/our behalf, at the Annual General Meeting of the Company to be
held on Wednesday, 28 April 2010 and at any adjournment thereof. I/We direct my/our proxy/proxies to vote for or against
the Resolutions to be proposed at the Meeting as indicated hereunder. If no specific direction as to voting is given, the proxy/
proxies will vote or abstain from voting at his/their discretion, as he/they will on any other matter arising at the Meeting.
No.
Resolutions
1.
Adoption of Directors’ Report and Audited Financial Statements
2.
Declaration of Final Dividend
3.
Approval of Directors’ fees
4.
Re-election of Mr Kua Hong Pak as Director
5.
Re-election of Mr Wee Siew Kim as Director
6.
Re-appointment of Mr Lim Jit Poh as Director
7.
Re-appointment of Mr Chin Harn Tong as Director
8.
Re-appointment of Mr Tan Kong Eng as Director
9.
Re-appointment of Auditors and authorising Directors to fix their remuneration
10.
Authority to issue shares pursuant to exercise of options
For*
Against*
* If you wish to exercise all your votes “For” or “Against”, please tick () within the box provided.
Dated this __________________ day of __________________ 2010
Signature(s) of Member(s)/Common Seal
IMPORTANT: PLEASE READ NOTES OVERLEAF
Total Number of Shares Held
NOTES
1. A member entitled to attend and vote at the Annual General Meeting is entitled to appoint one or two proxies to attend and vote in his stead. A proxy need not be a
member of the Company.
2. Where a member appoints more than one proxy, the appointments shall be invalid unless he specifies the proportion of his holding (expressed as a percentage of the whole)
to be represented by each proxy.
3. Completion and return of this instrument appointing a proxy shall not preclude a member from attending and voting at the Annual General Meeting. Any appointment
of a proxy or proxies shall be deemed to be revoked if a member attends the Annual General Meeting in person, and in such event, the Company reserves the right to refuse
to admit any person or persons appointed under the instrument of proxy, to the Annual General Meeting.
4. A member should insert the total number of shares held. If the member has shares entered against his name in the Depository Register (as defined in Section 130A of
the Companies Act, Cap. 50 of Singapore), he should insert that number of shares. If the member has shares registered in his name in the Register of Members of the
Company, he should insert that number of shares. If the member has shares entered against his name in the Depository Register and registered in his name in the Register
of Members, he should insert the aggregate number of shares. If no number is inserted, this form of proxy will be deemed to relate to all the shares held by the member.
5. The instrument appointing a proxy or proxies must be deposited at the Company’s registered office at 205 Braddell Road, Singapore 579701 not less than 48 hours before
the time set for the Annual General Meeting.
6. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorised in writing. Where the instrument appointing a
proxy or proxies is executed by a corporation, it must be executed either under its common seal or under the hand of its attorney or a duly authorised officer.
7. Where an instrument appointing a proxy is signed on behalf of the appointor by an attorney, the letter or power of attorney or a duly certified copy thereof must (failing
previous registration with the Company) be lodged with the instrument of proxy, failing which the instrument may be treated as invalid.
8. The Company shall be entitled to reject the instrument appointing a proxy or proxies which is incomplete, improperly completed, illegible or where the true intentions
of the appointor are not ascertainable from the instructions of the appointor specified on the instrument. In addition, in the case of shares entered in the Depository
Register, the Company may reject the instrument appointing a proxy or proxies if the member, being the appointor, is not shown to have shares entered against his
name in the Depository Register as at 48 hours before the time appointed for holding the Annual General Meeting, as certified by The Central Depository (Pte) Limited
to the Company.
Fold along this line
Affix
postage
stamp
The Company Secretary
SBS Transit Ltd
205 Braddell Road
Singapore 579701
This flap for sealing
All rights reserved. Some of the information in
this report constitute ‘forward looking statements’
which reflect SBS Transit’s current intentions,
plans, expectations, assumptions and beliefs
about future events and are subject to risks,
uncertainties and other factors, many of which
may be outside SBS Transit’s control. You are
urged to view all forward looking statements
with caution. No information herein should
be reproduced without the express written
permission of SBS Transit Ltd. All information
herein are correct at the time of publication.
For updated information, please contact our
Corporate Office.
A RAINDANCE DESIGN & PRODUCTION
This Annual Report is printed on
environmentally friendly paper.
Address
205 Braddell Road
Singapore 579701
Mainline
Facsimile
Website
Co. Reg. No.
(65) 6284 8866
(65) 6287 0311
www.sbstransit.com.sg
199206653M
SBS TRANSIT LTD

annual report

Transcription

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